PHOENIX - You may have seen them in your local convenience store: ATM machines used strictly for Bitcoin. Despite new legislation aimed at curbing crypto fraud, the scheme persists, causing some victims to lose their life savings.
"It's the Wild West," said Peoria Police Detective Mike Finney. It is an accurate description of the devastation that can unravel in minutes.
The backstory:
"I’m telling you. This is a scam," a Scottsdale police officer told a resident in a body cam recording.
All it takes is coercion by phone or even by force.
"They’re on the phone with the victim, and they instill fear," said Detective Jeff Brennan of the Scottsdale Police Financial Crimes Unit.
"He takes my phone, ‘give me the code, give me the code,’" one victim recalled.
"It's really uncharted territory," said Arizona Attorney General Kris Mayes.
As law enforcement navigates an ever-evolving world of cryptocurrency fraud, Mayes says the fight is far from over.
"I don't think we're done with this."
The Bitcoin ATM
In body cam footage from an officer at a Phoenix AM/PM store in October 2024, an elderly woman appears to be in a trance as she feeds hundred-dollar bills into a Bitcoin ATM.
Officer: "Please stop putting money."
Woman: "No, I can’t,"
Officer: "There’s an issue with it."
Woman: "No I have to keep doing it..."
Officer: "Why?"
Woman: "I’m almost done."
Officer: "Why? Stop you’re gonna lose your money."
Woman: "No I’m not."
This woman had no idea what she was doing as she fed $100 bills into a Bitcoin ATM at a Phoenix AM/PM.
Officer: "Stop, stop, stop, stop. Why are you doing this?"
Woman: "PayPal wanted to give me a refund for something."
Officer: "Did they call you or did you call them?"
Woman: "I called them."
The Scottsdale Police officer physically stopped her from depositing more cash. She had already given away $16,000 while on the phone with someone claiming to be from PayPal.
The situation is all too familiar for Detective Brennan.
"My checking account went from $11,000, which was my regular balance, to $31,000 because I made a $20,000 mistake when I went to the bank, so I had to go to the bank, get out the money, and I’m giving it back to PayPal," the woman told the officer.
"No, that’s not how PayPal works. I’m telling you. This is a scam. We get reports like this all the time," the officer replied.
The police report reveals the man on the phone claimed to help the woman "invest her money in Bitcoin" but the funds were routed elsewhere. The victim is a prime target for scammers, according to Mayes.
How bad was this crypto scam getting for elderly people?
"It was getting terrible for elderly people and when you talk to any police chief in Arizona, this is one of the top things that they will bring up to you, because they are the ones who see it, you know, in the first instance," Mayes said.
"David, what's your last name?"
Police say the man on the phone identified himself as David Smith from Georgia, but spoke with a foreign accent.
Scammer: "What happened?"
Woman: "I've put in $16,000 so far, and he won't let me finish. He wants to check you out. My husband called the police."
Scammer: "Okay, click on finish."
Woman: "There's only 16 in there."
Officer: "No, no, don't click finish."
The officer hung up the victim’s phone and contacted Athena Bitcoin customer service to cancel the transaction.
"David" called the woman back about 20 times, but she didn’t answer. Her husband is relieved. "It's okay, honey. Good to see you."
"They instill fear"
"They’re on the phone with the victim, and they instill fear, you know, in them," said Brennan. "And so, they feel compelled that they have to complete this activity or this deposit, basically to get out of whatever the scammers convincing them at the time."
Brennan says most times, the calls come from voice over internet protocol (VoIP), not traditional phone lines.
Finney says crypto scams have cost Peoria residents $27 million in two years. He is no stranger to Bitcoin ATMs.
"One of my victims had literally stood in front of the machine and stuck $100 bills into the machine for two and a half hours, lost $30,000, and I knew right where it was. I was looking at the machine, I couldn't get it back," Finney said.
Crypto is an unregulated investment and companies operating the Bitcoin ATMs take up to 20 percent commission on every dollar deposited. "It's the Wild West with regard to how money is moved, where it's stored, how it's transferred and translated to users," Finney said.
Crypto is an unregulated investment and companies operating the Bitcoin ATMs take up to 20% commission on every dollar deposited.
"It's the Wild West with regard to how money is moved, where it's stored, how it's transferred and translated to users," said Finney.
Variants of the crypto fraud scheme exist. One case began at the W Hotel in Scottsdale in March 2024. A man thought an Uber driver was taking him home, but he never got the ride he expected. Instead of a gray Toyota, he got into a gold Toyota.
"He told me every time, ‘give me the phone, I want to see the address.’ And I told him, ‘okay, you know why you need to see the address? You are an Uber.’ And then every time he told me, ‘I need to see the address.’ He takes my phone, [says] ‘give me the code, give me the code.' I gave him the code, and then he does something very weird. And he.. I told him every time, ’give me my phone, give me my phone back.' And boom, I see he dropped me like that in the way. And he was like, ‘get the f*** out of here’ screaming on me. And I was thinking he has a gun," the victim said.
The Hussein cryptocurrency theft case
"Yeah, I mean the Hussein case is a very complex fraud scheme. This is someone who also knows about cryptocurrency and that is local," said Brennan.
Officer: "Can you step out of the vehicle please, sir? Step out of the vehicle."
Nuruhussein Hussein was arrested in December 2024, accused of stealing a combined $223,000 in cryptocurrency from multiple victims by targeting Uber passengers.
Fake Uber driver allegedly stole thousands in crypto from customers
A man is accused of several felony charges after he allegedly posed as an Uber driver and then stole hundreds of thousands of dollars in cryptocurrency from customers in Scottsdale.
"And the victim would hand over their unlocked phone, and he would search for cryptocurrency apps on the victim's phone," Brennan said. "And from there, at the time, there were QR code transfers where you could do quick transfers from wallet to wallet, or in one of the instances, he actually had the victim's phone. After the ride, he gave him a decoy phone."
Officer: "That's not your phone?"
Hussein: "No, it's not my phone. This is.. you see ‘no SIM available. What's going on here? You take, I think, all my information, everything."
Moments after Hussein’s arrest, police seized his iPhone which contained dozens of wallet seed phrases linked to the "Exodus" app, according to Scottsdale PD. A seed phrase consists of random words that store data needed to recover cryptocurrency—the key to keeping digital assets safe.
The police report says two phrases associated with Hussein's wallets received stolen crypto with transaction times and amounts matching unauthorized withdrawals from victims' wallets.
Hussein is charged with fraud schemes and theft, but pleaded not guilty and is currently out on a surety bond, awaiting his 2026 trial.
By the numbers:
In most cases, investigators say the scams originate from overseas call centers, specifically in China, Russia, Europe, and predominantly India.
"They're very well-trained. They have unbelievable technology, and they set up office buildings full of these people to just do this 24/7," said Finney.
Meanwhile, Detective Brennan uses specialized software to track stolen crypto, tracing transfers from the theft, and monitoring the flow of money through different wallets or cryptocurrency exchanges.
Recovering stolen funds is challenging, especially when they enter a mixer -also known as a cryptocurrency tumbler, which obscures the flow of digital currency to protect user privacy. Sometimes subpoenas are needed to investigate further.
It can take several months or even years for a wallet to transfer funds, but Brennan can set alerts on any movement, literally following the money. As an example, he showed FOX 10 how much money was moved it total.
"In this particular instance, I believe the victim lost $150,000," he said.
"When we started, it was maybe 17 in the whole state, and it bloomed up to almost 600 ATMs in the state of Arizona," said Finney.
Local convenience stores and smoke shops host kiosks for payment, but the crypto landscape has historically lacked oversight. Peoria Police identified a key issue early on: operators didn’t have business licenses within cities or the Arizona Corporation Commission.
"We wanna make sure that we're aware of that machine and that there's some regulations about what that machine is there for and who's operating it and where the funds are going," said Peoria Police Chief Thomas Intrieri.
In 2024, Arizonans lost $177 million due to cryptocurrency fraud.
"It's a huge problem. The big issue was we needed t out daily limits of some kind," said Mayes.
Together, Republican State Rep. David Marshall and Peoria PD worked to pass House Bill 2387.
"These were real-life scenarios where we talked about the victims and how they had become victimized by an unknown entity and how real it was and how tangible. And I shared how that could affect any one of us and or our family members."
"What this bill is for is to protect seniors, and it's to put on guardrails," Marshall said.
Here are those guardrails for Bitcoin ATMs:
- Daily transaction limits are $2,000 a day for new customers and $10,500 for existing customers.
- Warning signs must be displayed on screen, requiring customer acknowledgment before proceeding.
- Kiosk and ATM operators must issue full refunds, including fees, to new customers reporting fraud within 30 days of the transaction.
"It allows us to actually establish and have a relationship with the ATM operators, and they are now being held accountable to stop acting as a third-party uninvolved money services converter and beholden to the law, meaning they have to create a circumstance where we can now investigate and have a potential to recover." Finney said.
Officer: "Based on what he’s telling me is that you should get refunded the $16,000 you put in the machine."
The woman at the Phoenix convenience store was lucky that the officer got there when he did. She paid a $90 service fee and got $15,910 back.
What you can do:
The FTC warns consumers to slow down when contacted by a scammer, avoid clicking links or responding to unexpected calls or messages and never withdraw cash in response.
What's next:
HB2387 has been in effect since October 2025, but law enforcement doesn’t believe crypto fraud is over. AG Mayes advocates for even tighter Bitcoin ATM regulations.
"I don't think we're done with this. I mean I think the limit is already, is still too high. That's too much money that you can lose on a daily basis," said Mayes.
The Source: Interviews with Arizona Attorney General Kris Mayes, Scottsdale Police Detective Jeff Brennan and Peoria Police Chief Thomas Intrieri and Detective Mike Finney.