New rules to prevent Cryptocurrency fraud
An ordinance to crack down on fraudulent crypto in Sterling Heights. There’s a new ordinance that’s now passed there because police say they’ve dealt with far too many cases of fraud.
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STERLING HEIGHTS, Mich. (FOX 2) – An ordinance was made to crack down on fraudulent crypto in Sterling Heights. The new ordinance was passed because police say they’ve dealt with far too many cases of fraud.
Timeline:
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Officials started keeping track of cases on Jan. 1.
Police say they’ve investigated 23 fraud cases tied to the city’s 27 machines, with losses exceeding $542,000, with seniors making up most victims, but the FBI estimates it could be more than that, maybe as much as a million just in Sterling Heights.
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Sterling Heights City Council introduced a new ordinance to strengthen regulations on virtual currency machines, including Bitcoin ATMs, in response to a sharp rise in crypto-related fraud. The ordinance would require business and operator licensing, annual fees, ID verification for users, fraud warnings, transaction receipts, customer service hotlines, limits for first-time users, and routine inspections.
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Dig deeper:
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Existing operators must comply by March 31, 2026, with the types of scams:
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“One being a romance scam where somebody is texting or a Facebook page, and they text back and forth person needs money via bitcoin so they can come to the country. Some are giveaways,” said Sterling Heights Police Captain Colleen Hopper.
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Operators must also keep transaction and service records for at least 90 days while protecting personal data.
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The city says the move is especially urgent during the holiday season, when scams typically spike and a new Police Department Crypto Task Force has been created to combat the problem.