How the fraudsters have used crypto ATMs to rob millions of people from Canadian scam victims
Brenda Smith did not know what a cryptocurrency ATM was before he was directed to deposit more than $ 12,000 cash in two machines last year as part of a wide cyber scam.
The 76 -year -old Calgary Retired faced a stroke a few months ago, saying that she was cognitively impressed.
“They are very confident, and unfortunately I was weak,” Smith said.
“They went through what I have to do, and so, I just deposited the money and never gave it a second idea.”
Crypto ATMs can see a lot like a traditional banking machine, but instead of spreading cash from your bank account, most of these machines allow customers to deposit cash and then convert it into cryptocurrency like bitcoin. Then, they can send it to a virtual wallet anywhere in the world.
Smith has no idea where her money ended.
“It was disastrous, even though it was only $ 12,000,” she said. “When you are senior on pension, it is a lot of money.”
Crypto ATM was first installed in a small Vancouver Coffee Shop Back in 2013. At that time, the machine was honored as a pioneer for innovation by offering a fast, accessible way to buy crypto. A dozen years later, there are about 3,600 crypto ATMs across the country and over 39,000 worldwide – and authorities are worried about how machines are being used and by whom.
Look CBC investigation shows why Crypto ATMs are so popular for fraudsters:
According to a federal report, Crypto ATMs are mainly receiving money from Canadian people. CBC’s Angelina King and Farah Merli noted the issue in the three-part series feeding fraud: The Crypto ATM problem.
CBC News spent months spent in view of this industry, law enforcement, financial regulators, pre-crypto ATM company employees, operators themselves and speaking to the victims for this three-part series feeding fraud: Crypto ATM problem.
Investigations have revealed that these machines legally operated in Canada have become the main vehicle fraudsters to get money from scam victims across the country. Canadian Financial Intelligence Agency, Fintrack, reached the conclusion in the analysis of the suspected transaction report submitted to the agency in February 2023.
“Finntrack said that the Bitcoin Automated Taylor Machine (BATMS) would remain the primary method that domestic and international criminal criminals of fraud would be used to receive money from their victims and rob those income within the Cryptocurrency ecosystem,” the report recently read a report through a access request for information request.
“It is highly likely that the number of Canadian victims targeted by the organized fraud -based network located in other countries will continue to increase. Criminal groups are developing innovative and refined fraud campaigns to direct Canadian to give money in the bat.”
ATMs are legal, but exploited
Despite those conclusions, FintraC is not looking at them, how many companies operating these machines or where they are located in Canada. Instead, Crypto ATM operators are classified as a “money services business”, a designation that includes foreign exchange dealers, regular ATMs and money-transfer services, such as Western Union.
CBC News requested an interview with the head of Fintrack for the series, but the request was rejected. The written response of the Financial Intelligence Agency did not answer the CBC questions whether, if anything,, FinTrac has done to address the conclusions coming in its two -year report.
Instead, the agency provided data on the financial revelations provided for law enforcement investigation last year and included the legal obligations of businesses of money services.
Under that designation, Crypto ATM companies have to register with Fintrack and are subject to a federal anti-money laundering law, for which they are required to submit a report for large cash transactions, suspicious transactions and to know their customer (KYC) rules-as it is necessary to verify a person’s identity-more than $ 1,000. But there are no rules controlling some aspects of the industry, such as fees operators can charge or limit customer transactions.
Available statistics ‘snow tip’
Major police services like RCMP, OPP and Toronto Police are not tracking how many of the fraud reported by them include the use of crypto ATMs in fraud.
The only national law enforcement group to keep those figures appears to be Canadian Anti-Frod Center (CAFC). Fraud victims reported a $ 14.2 million decrease for scams through Crypto ATMs in 2024, and this year, with a report of over $ 4.2 million in the first three months of 2025, is at the speed of crossing the loss.
But those numbers come with big cavets. CAFC estimates that only five to 10 percent of the incidents of fraud are reported.
And its figures usually do not include police reports. According to Toronto Police DET, they certainly do not include Toronto Police or OPP report. David Coffee.
Coffee, who works in a financial crime unit, said, “They are iceberg’s tips – literally – I mean their tip cannot be out of water yet.”
“They need to multiply it by 10 or 20 to get a vague sense of real loss.”
Daily fraud report related to Crypto ATM
Detective states that the Toronto Police receives a daily fraud report related to the Crypto ATM, and the challenges investigating these cases may be “inaccessible”.
“As soon as it is sent, that money is all over the world,” he said. “Not only that, but bad people are all over the world … We are not just, mostly, resources or rights, jurisdles to get that money back or bring them to attention.
Coffee and Canadian and other people in the International Law Enforcement said that CBC News Crypto ATM is being used as a tool, which ranges from romance scam to impression, CRA scam.
“The use of Crypto ATMs to execute these crimes has increased noticeable,” the SGT said. Gordi Jones, a National Cryptocurrency Coordinator for RCMP.
A part of that trend may arise from the spread of these machines and as a result.
Most Crypto ATM per capita
According to Blockchain Intelligence Company TRM Labs, Canada now has the most crypto ATM per person in the world, with around 91 per million inhabitants and the second largest number of machines (behind the US) per country.
From the beginning of this year in mid -August, the company found that Crypto ATMs in Canada processed around $ 1.5 billion.
TRM has added about $ 160,000 about illegal activity by mapping the cryptocurrency wallet, which is associated with fraud and other forms of money laundering. But the company’s global policy says that it is a part of the real amount.
Ari Redboard said, “The number in the number is quite high, potentially 85 percent more, which we are seeing.” “The challenge is that the reporting is the challenge that all the law enforcement is at the global level – and this is such a little problem.”
So why Crito ATMs have become such an attractive tool for fraudsters?
Experts in the area say that appeal rests on facility and speed.
“People can now send transmission, humanitarian aids, rapid and more than before,” the Redboard said. “Although the challenge bad actors can also take funds from across the border at the pace of the Internet.”
A finance professor at Andreas Park, University of Toronto and co-founder of its blockchain research lab, pointing to access: machines do not need to use bank account and rarely use a certification process in addition to a phone number for transactions under $ 1,000.
The park said, “The low barrier to use them and get access to crypto assets actually allow crime.”
The combination of those factors and the lack of human interaction in the transaction that makes machines attractive to scammers, coffee said – as well as a knowledge interval when it comes to the victims.
“They are not evil themselves, but they are a tool used by fraudsters to facilitate fraud,” the detective said about the Crypto ATM. “It’s easy, it’s sharp, it is irreversible … and they actually, really weakened communities that do not really understand what cryptocurrency is.”
In Smith’s case, the 76 -year -old man did not realize that he was cheated until he told his daughter, and then his daughter reviewed his finance.
“I just felt so stupid,” Smith said. “It was the same as someone came to the house and just took me.”
Tomorrow: Part 2 of Feeding Fraud: Crypto ATM problem will dig in companies behind these machines in Canada, how they change a profit, and what they are doing and to prevent fraud.
