Victims advocate questions crypto ATMs | News

Brian Watson describes himself as a “capitalist to the core.”

Yet he sees no social value in cryptocurrency automated teller machines and kiosks, available to crypto buyers 24/7 in convenience stores and other retail locations across Northwest Tucson.

“I just see it as a fraud receptable,” said Watson, an Oro Valley resident and retired federal criminal investigator who is now the community outreach specialist for Resources / Outreach to Safeguard the Elderly, or ROSE.

“I’ve met too many people who’ve been scammed by them,” sometimes losing life savings and six-figure sums, he said. “I’ve talked to too many people who’ve lost money.”

Watson urges Oro Valley to follow the lead of Spokane, Washington, which has banned crypto ATMs and kiosks.

“I want to get rid of them, or have a public debate, ‘We want these, or we don’t want these’,” he said. “Oro Valley could be a leader on this.”

Darren Wright, spokesman for the Oro Valley Police Department, said OVPD “would not have a side on whether they should be banned or not. That’s not our lane to say. It’s a business regulation, not a criminal regulation.”

OVPD recognizes crypto ATMs can be “an avenue for the scammers” who intimidate vulnerable seniors, coercing them to pour unrecoverable cash into crypto ATMs, Wright said. Then, again, the ATMs serve “some legitimate use, too,” he added.

Watson believes a new state law placing limits, noticing, receipt and recovery requirements on crypto machine vendors is a positive first step in protecting people victimized by criminals.

“I like this law,” Watson said, but it is “a compromise, in my humble opinion.”

Beyond the law, “I’ve started to change my mind on this,” Watson continued. “Why do we even have these things in the first place? Why don’t we stop it at its source?”

Watson waved his phone and said people who want to invest in cryptocurrency can do so “right here, and you can get a better rate” with fewer fees than a crypto ATM would assess. “You can invest in cryptocurrency in other ways,” he said.

Watson reached out to Oro Valley Town Councilmember Mary Murphy, who had “no idea” crypto ATMs “were that prolific,” Watson said. In turn, Murphy set up a meeting with Watson, Oro Valley Police Chief Kara Riley, and Commander Mike Gracie. Murphy said Watson was “extremely knowledgeable and provided quite a bit of insight into crypto ATMs.

“Admittedly, I didn’t know much about them until we met,” Murphy said. “Because this a relatively new issue, the legislative authority is a little unclear, so I am doing more research on it.”

A new Arizona law requires fraud warning signage on crypto ATMs. The city of Lincoln, Nebraska, with more than 100 crypto ATMs in its limits, has passed a public ordinance mandating large warning signs on the machines.

“I like the additional signage,” Watson said.

“Warning our community, especially the vulnerable community” who may be victimized by criminals, “is a good thing,” OVPD’s Wright agreed.

Not long ago, Watson walked into a mall while attending a fraud prevention presentation in Flagstaff. In the entry way, a boldly advertised cryptocurrency ATM “gets your attention.” While he examined it, “a man walks up to me and says ‘you’re not getting scammed, are you?’” Watson explained who he is, and what he was doing.

“’I’ve stopped so many people from getting scammed’,” the man told Watson. That individual has “seen the fraud. He’s like a good Samaritan. What happens when he’s not there?”

Murphy said “the safety of our residents is my always my absolute top priority, so I plan to work closely with OVPD, staff, and my fellow councilmembers to ensure that we are doing everything within our legal authority to keep our community safe.”