CHICO — One. Hundred. Thousand. Dollars.
We learned this past week that an elderly woman in a neighboring county lost $100,000 to a scammer who tricked her into putting money into a Bitcoin machine right here in Chico and despite their efforts, local law enforcement was unable to return her money.
If I come off as angry this week it is because there are more than 50 of these Bitcoin ATMs in Butte County and many of them have been used to scam residents to funnel money to some unknown entity. Chico Police Department Detective Kevin Hass gave a great presentation before the Butte County Board of Supervisors last week ultimately calling for a county-wide ban of the machines and I have to say, it’s hard not to support that given the evidence.
Hass and his team have had to bring in the Chico Fire Department to physically crack open the machines to return money to people who were scammed.
I’ll reiterate a part of his presentation and my story from Wednesday here. The scammer calls the person hoping that they are elderly or at least aren’t savvy to Bitcoin and pretend to be God knows what agency saying that the target will have to wire them money, oftentimes to the tune of about $30,000, but we now know it can go much higher.
The scammer stays on the phone with the person and guides them to more than one bank, as most banks have some level of alert for withdrawals of $10,000 and up, and even tells the target to lie to the teller and pretend the money is for something else. So now they are driving all around the city, maybe even more than one city, to withdraw money from multiple branches to get the full amount. After this, the scammer guides them to a Bitcoin machine, which doesn’t have the same regulations as a normal ATM, and send the money on over.
Typically the target will realize they are being scammed and report it to the police. If law enforcement can get to the machine fast enough, they can get a warrant and get into the machine to get the money back.
One thing that frustrated me in particular about Hass’s presentation is that he said of all the Bitcoin machine-related scams he’s overseen, none of the owners of the machines cooperated and instead said they were losing money from having to break the machine open. If someone had to be scammed to put that money into your machine, that’s not your money. Period.
I’ll end this by paraphrasing Butte County Sheriff Kory Honea who backed Hass in his efforts during the meeting. A single Bitcoin costs about $70,000. No legitimate business deals costing $70,000 are happening at a machine in a liquor store.
Be safe out there folks.
Scam of the Week generally runs every Tuesday. Readers are welcome to contact reporter Jake Hutchison to report scams and potential scams they have come in contact with by calling 828-1329 or via email at jhutchison@chicoer.com.
