New law aims to crack down on cryptocurrency fraud

Ala. (WSFA) – A new Alabama law takes effect Oct. 1. designed to crack down on cryptocurrency fraud

According to the Alabama Securities Commission, cryptocurrency scams have already cost Alabama consumers millions of dollars in 2026.

Cryptocurrency is a form of digital currency that is harder to track since it is not exchanged through traditionally regulated financial institutions.

“I know the kiosk operators certainly don’t want users losing money to fraud and other criminal activity and so they’re absolutely motivated to come into compliance really quickly,” said Amanda Senn, director of the Alabama Securities Commission.

Senn said they have received hundreds of reports from Alabama law enforcement agencies about cryptocurrency scams in the past few months.

“Once the money’s transmitted, the likelihood of recovery is slim to none,” she said. “Criminals, I know, exploit all new technologies, but they have absolutely began using cryptocurrency kiosks or Bitcoin ATMs as vehicle to help perpetrate their fraud. They find it easy to conceal the nature of the transactions.”

The new regulations set transaction limits, refund certain fraud-related transactions and require enhanced disclosures at cryptocurrency kiosks or ATMs.

There will also be identification verification. For Alabamians older than 60, there will be additional questions prompted about the transaction to make sure that it is not a part of a scam, such as paying off a government fine.

“We hope this prevents millions and millions and millions of dollars because those are the losses we’ve seen as a result of these machines and they are staggering,” she said.

Anyone who thinks they are a victim of cryptocurrency fraud is encouraged to contact the Alabama Securities Commission.

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