Stop Crypto ATM Scams Act

Section 5330 of title 31, United States Code, is amended—

(1) in subsection (d)—

(A) in paragraph (1)(A), by inserting, any digital asset kiosk operator, after similar instruments; and

(B) by adding at the end the following:

The terms digital asset kiosk and digital asset kiosk operator have the meaning given those terms, respectively, under section 5337(a).; and

(2) by adding at the end the following:

The Secretary of the Treasury shall require a digital asset kiosk operator—

(A) before beginning to operate a digital asset kiosk, to submit a list containing the physical address of each digital asset kiosk owned or operated by the digital asset kiosk operator; and

(B) not less than once every 90 days thereafter, to submit an update to such list.

Each submission by a digital asset kiosk operator pursuant to paragraph (1) shall include—

(A) the legal name of the digital asset kiosk operator;

(B) the physical address of each digital asset kiosk owned or operated by the digital asset kiosk operator that is located in the United States or the territories of the United States;

(C) up-to-date contact information for the digital asset kiosk operator’s compliance officer described in section 5318(h)(1)(B);

(D) the start date of operation of each digital asset kiosk; and

(E) the end date of operation of each digital asset kiosk, if applicable.

The filing of false or materially incomplete information in a submission required under paragraph (1) shall be deemed a failure to comply with the requirements of this subsection.

The Secretary of the Treasury shall make all information submitted under this subsection available to the public, including on a website of the Department of the Treasury.

A person who is a digital asset kiosk operator (as defined in section 5337(a) of title 31, United States Code) on the date of enactment of this Act—

(1) shall, not later than the end of the 6-month period beginning on the date of enactment of this Act, submit the initial list described in such section 5330(f)(1)(A); and

(2) shall, not later than 90 days after the end of the 6-month period beginning on the date of enactment of this Act, submit the first update of such list.

Subchapter II of chapter 53 of title 31, United States Code, is amended by adding at the end the following:

In this section:

The term charge means—

(A) fees or expenses paid by a customer; and

(B) the difference between the market price of a digital asset and the price of the digital asset charged to the customer.

The term digital asset means any digital representation of value that is issued or transferred using a cryptographically secured distributed ledger, blockchain technology, or any other similar technology.

The term digital asset kiosk means—

(A) an automated teller machine that facilitates the buying, selling, or exchange of digital assets for fiat currency or other digital assets; or

(B) a digital or mobile application that facilitates the buying, selling, or exchange of fiat currency for digital assets at a participating physical location in an organized merchant network.

The term digital asset kiosk operator means a person that owns or operates a digital asset kiosk.

The term digital asset wallet means a software application or other mechanism that provides a means for holding, storing, and transferring digital assets.

The term digital asset wallet address means an alphanumeric identifier that is associated with a digital asset wallet and represents a potential destination for a digital asset transfer.

The term extended business hours means—

(A) the hours between 8:00 a.m. and 8:00 p.m. local time on business days; and

(B) the hours between 9:00 a.m. and 5:00 p.m. local time on weekends and holidays.

The term market price means, with respect to a digital asset, the current market price of a particular digital asset publicly quoted on a digital asset trading platform that is registered with the Department of the Treasury for a particular time.

With respect to a digital asset kiosk operator, a person is a new customer of the digital asset kiosk operator if—

(A) the person has never previously transacted with the digital asset kiosk operator; or

(B) less than 14 days have elapsed since the person entered into their first transaction with the digital asset kiosk operator.

A digital asset kiosk operator shall—

(A) develop, implement, and routinely update an anti-money laundering program described in section 5318(h), and file a copy of such program with the Financial Crimes Enforcement Network;

(B) be subject to the requirement to report suspicious transactions described in section 5318(g); and

(C) be subject to the requirements described under this subchapter to file currency transaction reports.

Not later than 180 days after the date of enactment of this section, the Secretary of the Treasury shall issue rules to require a digital asset kiosk operator, in implementing an anti-money laundering program required under paragraph (1)(A), to adopt controls that are reasonably designed to—

(A) verify a customer’s identity, including during any online pre-registration process and at the physical digital asset kiosk location;

(B) monitor for digital asset kiosk transactions involving a digital asset wallet directly or indirectly associated with any digital asset wallet address listed on any relevant sanctions lists through the use of blockchain analytics tools;

(C) assess the risks associated with and the likelihood of future illicit activity in connection with digital asset kiosk transactions through the use of blockchain analytics tools; and

(D) maintain restrictions that prevent more than one customer of such digital asset kiosk operator from using the same digital wallet address.

A digital asset kiosk operator may not accept one or more digital asset kiosk transactions on behalf of a new customer that have a total monetary value of more than $2,000 during a 24-hour period.

A digital asset kiosk operator may not accept digital asset kiosk transactions on behalf of a new customer that have a total monetary value, in the aggregate, of more than $10,000.

With respect to a customer that is not a new customer, a digital asset kiosk operator may not accept one or more digital asset kiosk transactions on behalf of the customer that have a total monetary value of more than $7,500 during a 24-hour period.

The Secretary of the Treasury shall update the dollar amounts in this subsection every 5 years to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics of the Department of Labor.

The Secretary of the Treasury may issue rules to adjust the transaction limit amounts described under this subsection, as the Secretary determines are reasonably necessary to deter fraudulent activity and illicit finance.

A digital asset kiosk operator shall take reasonable steps to provide written disclosure to any customer prior to initiating a digital asset kiosk transaction, in English and in the same language principally used by the digital asset kiosk operator to advertise or solicit customers, including by displaying the disclosure in a prominent, conspicuous, easily readable manner, that contains the terms, conditions, and itemized elements of the transaction and contains the following:

(A) A warning written prominently in bold type stating the following: Warning: Losses due to fraudulent or accidental transactions may not be recoverable and digital asset kiosk transactions are irreversible..

(B) The following statement: Digital assets are not legal tender. Digital assets are not backed by the full faith and credit of the United States Government or guaranteed by the United States Government. Digital asset wallet accounts and digital asset balances are not subject to FDIC insurance or NCUA insurance..

(C) The amount of digital assets involved in the transaction and the type of digital assets involved in the transaction, including the ticker or symbol that is used to represent a digital asset.

(D) The U.S. dollar price of the digital assets involved in the digital asset kiosk transaction that is charged to the customer and the current U.S. dollar market price of such digital assets, as is quoted on at least one digital asset trading platform that is registered with the Department of the Treasury and is identified by name, at the time the disclosure is provided.

(E) The amount of charges collected from the customer by the digital asset kiosk operator, which shall be—

(i) displayed prominently in bold type on a dedicated disclosure screen; and

(ii) presented as an itemized list that separately identifies—

(I) any fees or expenses paid by the customer, expressed in United States dollars and as the percentage of the transaction; and

(II) the difference, expressed in United States dollars, between the current market price of the digital assets involved in the transaction and the price of such digital assets charged to the customer.

Not later than 180 days after the date of enactment of this section, the Secretary of the Treasury, in consultation with the Federal Trade Commission and the Director of the Bureau of Consumer Financial Protection, shall issue guidance to assist digital asset kiosk operators with providing disclosures described in paragraph (1) that are effective, clear and conspicuous, easily understandable, and displayed in a standardized format.

A digital asset kiosk operator shall take reasonable steps to detect and prevent financial fraud, including by taking the following steps:

(A) Providing clear scam warnings to customers before entering into a digital asset transaction that, at a minimum, address the following common fraudulent tactics:

(i) Payment requests to an individual the customer has never met.

(ii) Initial contact via social media, online dating, or other messaging applications.

(iii) Impersonation of representatives from government agencies, financial institutions, credit unions, or other legitimate organizations or businesses.

(iv) Urgent or emergency requests.

(v) Utilizing a scannable code associated with a digital asset wallet that is not owned by the customer.

(B) Updating, on an annual basis, the warnings described in subparagraph (A), which shall be informed by the annual fraud alerts or notices described in subsection (k).

Not later than 180 days after the date of enactment of this section, the Secretary of the Treasury shall issue rules to require a digital asset kiosk operator to develop, implement, and routinely update an anti-fraud policy that—

(A) is in writing and available for inspection by the Secretary of the Treasury or the Secretary’s designee;

(B) is signed by, certified by, and accountable to senior management of the digital asset kiosk operator; and

(C) includes policies, procedures, controls, and monitoring mechanisms to address the fraudulent practices described in paragraph (1)(A).

Each time a customer uses a digital asset kiosk, the digital asset kiosk operator shall ensure acknowledgment of all disclosures required under subsection (d) and fraud warnings under subsection (e) via confirmation of consent of the customer at the digital asset kiosk.

Prior to initiating a digital asset kiosk transaction on behalf of a new customer, a digital asset kiosk operator shall obtain confirmation from the new customer that—

(A) the new customer has reviewed the disclosure of charges described in subsection (d)(1)(E); and

(B) the new customer understands the total charges as a percentage of the transaction amount.

An acknowledgment described under this subsection shall not be construed to waive, nullify, or limit any right to a refund or other remedy available to a customer under applicable State or local law.

Upon completion of each digital asset kiosk transaction, the digital asset kiosk operator shall provide the customer with a physical or electronic receipt, which shall include the following information:

(1) The name and contact information of the digital asset kiosk operator, including a telephone number for a customer service help line.

(2) The name of the customer.

(3) The type, value, date, and precise time of the digital asset kiosk transaction, and each applicable digital asset wallet address.

(4) The amount of United States dollars or other fiat currency involved in the transaction.

(5) The amount, in United States dollars, of any charges collected by the digital asset kiosk operator in relation to the transaction, presented as line-items summed within the total transaction.

(6) A statement that the customer should contact law enforcement if they suspect fraud or scams, including the contact information for the relevant local law enforcement agency and for applicable State and Federal law enforcement agencies.

(7) Any additional information the digital asset kiosk operator determines appropriate.

A digital asset kiosk operator shall provide live customer service during extended business hours and display the phone number for such service in a clear, conspicuous, and easily readable manner upon each digital asset kiosk.

A digital asset kiosk operator shall issue a refund for charges collected from a customer in connection with a digital asset kiosk transaction within 30 days if—

(1) the customer was fraudulently induced into engaging in the digital asset kiosk transaction; and

(2) the customer files a complaint to the digital asset kiosk operator, which includes—

(A) the name, address, and phone number of the customer;

(B) information that establishes the type, value, date, and time of the digital asset kiosk transaction; and

(C) a copy of a report to a State or local law enforcement agency or a Federal or State authority made not later than 90 days after the digital asset kiosk transaction.

The Secretary of the Treasury shall issue rules to require a digital asset kiosk operator to provide the Financial Crimes Enforcement Network and other relevant law enforcement and government agencies with a dedicated and frequently monitored phone number and email address to facilitate communication with the operator in the event of reported or suspected fraudulent activity.

Not later than 9 months after the date of enactment of this section, and for each calendar year thereafter, the Secretary of the Treasury, in consultation with the Federal Bureau of Investigation and the Federal Trade Commission, shall issue an alert or notice to assist digital asset kiosk operators in—

(1) identifying emerging fraud schemes involving digital asset kiosks; and

(2) filing suspicious activity reports.

Nothing in this section may be construed to limit the authority of a State regulatory agency to require a digital asset kiosk operator to ensure registration, licensing, and compliance related to applicable State laws.

A State regulatory agency may—

(A) issue a decal or physical sign that can be affixed to a digital asset kiosk, in a form or manner determined by the State regulatory agency, to signal compliance with applicable State and Federal laws, including whether—

(i) the physical location of such digital asset kiosk has been filed with the Secretary of the Treasury; and

(ii) the operator of such digital asset kiosk is registered with the Secretary of the Treasury and has obtained the appropriate licensing from the State regulatory agency;

(B) administer a process through which a digital asset kiosk operator is issued such decal or sign for affixation to the digital asset kiosk; and

(C) impose penalties for any false advertising, misuse of signage, or misrepresentations of regulated or compliant status.

The Secretary of the Treasury, acting through the Financial Crimes Enforcement Network, may enter into agreements with State regulatory agencies to facilitate the supervision of digital asset kiosk operators and enhance compliance with Federal standards, including agreements relating to the coordination of examinations and the sharing of supervisory information for the purposes of enforcing applicable Federal standards.

This section—

(A) shall supersede any applicable State or local law with respect to restrictions or requirements established after the effective date of this section on the total monetary value that any customer may exchange in one or multiple digital asset kiosk transactions within a defined time period;

(B) may not be construed to limit the authority of a State regulatory agency or local authority to impose other requirements in order to protect consumers or prevent fraudulent or money laundering activity;

(C) may not be construed to permit a digital asset kiosk operator to operate or otherwise conduct business in a State without obtaining the appropriate licensing from the applicable State regulatory agency and complying with other applicable State laws; and

(D) subject to subparagraph (A), may not be construed as altering, limiting, or affecting the authority of a State attorney general or any State regulatory agency to bring an enforcement action or other regulatory proceeding arising solely under the law in effect in that State.

Section 5337 of title 31, United States Code, shall take effect at the end of the 180-day period beginning on the date of enactment of this Act.

The table of sections for chapter 53 of title 31, United States Code, is amended by inserting after the item relating to section 5336 the following: