Nebraska Governor Signs Cryptocurrency Fraud Prevention Bill into Law

On March 11, Governor Jim Pillen signed Nebraska Legislative Bill 609, the Controllable Electronic Record Fraud Prevention Act, into law. Introduced by State Senator Eliot Bostar and endorsed by AARP Nebraska, the bill successfully passed its final reading on March 6.

This crucial legislation was designed to implement consumer protections from scams involving gift cards and cryptocurrency kiosks—also known as digital currency ATMs. Similar in appearance to a bank ATM, they allow people to conduct cryptocurrency transactions, such as sending money through a digital wallet. Once the money is gone, it's very hard to track and recoup.

Prior to this law, these kiosks have been largely unregulated at the state level compared to traditional financial institutions, lacking sufficient consumer fraud protections. Because of this, criminals have been using them to commit fraud and steal millions of dollars through highly sophisticated scams.

Todd Stubbendieck, State Director of AARP Nebraska, shared “This is a significant victory for Nebraskans and law enforcement. With stronger protections against cryptocurrency theft, we are better equipped to safeguard Nebraskans’ hard-earned life savings, especially for those aged 50 and older, from financial exploitation.”

In 2023 alone, the FBI received over 5,500 complaints involving cryptocurrency kiosks, with reported losses amounting to over $189 million. Alarmingly, more than 65% of these losses were incurred by individuals aged 60 and above. Overall, the FBI reported $5.6 billion in crypto-fraud losses in the same year.

Nebraskans themselves reported 239 digital currency scam complaints in 2023, totaling approximately $14.6 million in losses. The actual losses are likely higher, as many victims are hesitant to report scams due to embarrassment.

The law establishes requirements around licensing of state operators to ensure only vetted operators manage these kiosks; daily transaction limits to protect consumers from large-scale theft; fraud warning notices to increase awareness about potential scams; transaction receipts to provide traceability to assist law enforcement with criminal investigations; fee caps to prevent excessive charges; and that cryptocurrency operators issue refunds for transactions identified as fraudulent.

To learn more and for fraud-prevention resources, visit https://www.aarp.org/NebraskaScamAlerts.