With the increasing popularity of cryptocurrencies, a large number of scammers and con-men are misusing this technology to defraud their victims. Similarly, the rising number of Bitcoin ATMs has led to a rise in Bitcoin ATM related fraud. In a recent update from Canada, a woman who was a victim of one such fraud tried to sue the company that owned the Bitcoin ATM after she was defrauded. However, the courts in the country ruled against her.
The fraud victim, unnamed for the purpose of security, sued Instacoin ATM Canada Inc. for 62,500 CAD ($48,125 in USD). The case was heard at the Charlottetown Provincial Court, where chief judge Nancy Orr ruled in the favour of the firm, stating that the onus is on the person who buys the Bitcoins. The judge stated:
“It’s most unfortunate that she was victim of such a sophisticated fraud...It’s up to the bitcoin purchaser to know what they’re doing.”
Michael Drake, the lawyer representing Instacoin ATM Canada Inc. stated that the company was not at fault because they merely provided a financial service to the woman as it converted her cash into cryptocurrencies - and then sending the currency to the address that she provided, thereby the onus of performing the actual act of transferring the currencies to the scammers was on the woman and not on the company.
The woman received a call from a con-man claiming to be calling her from the Canada Revenue Agency, asking her to deposit a 62,500 CAD at a Bitcoin ATM because she had overdue taxes. The caller threatened the woman, an immigrant, with arrest and deportation.
The case that the woman filed was on the legal ownership of the money that she had deposited to the ATM. She testified in court that the scammers had her on speed dial, and knew some intimate details about her family members. She made two withdrawals from her bank in February and deposited them into a Bitcoin ATM at a restaurant in Charlottetown. The scammer had provided the woman with a Bitcoin Address, telling her that it belonged to the revenue agencies, where she sent the money.
This kind of a fraud is getting popular across the globe, a recent such case was reported in Australia as well. It has been noted that immigrants are being specifically targeted as they are often living in the fear of deportation and are swift to deposit the money. Reports from Canada indicate that over 40 people had been scammed of over 300,000 Canadian Dollars in a similar manner, where they would be called by the scammers and asked to deposit their unpaid taxes to a Bitcoin ATM.
Judge Orr, who presided over this case had a remarkable comment which sums up this case and other similar cases around the world really well. She stated that while anonymity is a key feature and a strength of cryptocurrencies, it is the same anonymity that comes out as a weakness of this technology when cases of fraud are concerned.
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