Missouri AG targets CoinFlip in crypto ATM fraud lawsuit seeking $1.8M in penalties

Missouri’s AG sued CoinFlip for knowingly allowing scammers to use its Bitcoin ATMs to steal money from residents and for charging fees as high as 22% without informing customers. The lawsuit seeks to shut the company’s doors in Missouri and impose a fine of up to $1.8 million.

The lawsuit was filed in the Circuit Court of Jasper County and names GPD Holdings LLC as the defendant. 

According to Attorney General Catherine Hanaway, “Bitcoin and crypto ATMs are the new getaway cars for fraud, whisking away innocent people’s money to scammers, never to return.”

Who are the three victims in this lawsuit, and what happened to them?

The first victim is an 80-year-old military veteran scammed by a suspect under the alias Selina Lee in the fall of 2025.

Lee contacted the old man, claiming to have made a fortune from cryptocurrency, and encouraged him to invest through CoinFlip.

Without prior notice, the man sent Lee between $180,000 and $200,000 from September 2025 to March 2026. When Lee asked for more, the man sold his car and withdrew money from his investment accounts. He almost lost his apartment when a friend stepped in to pay his rent.

The veteran now lives off Social Security and has lost all his savings.

What’s worse is that the ATM never showed him the fees for all his transactions, and Lee simply told him there would be a fee of $5,000 to $15,000 per transaction.

The second victim (we’ll nickname her Jane Doe) was contacted by a woman who claimed to be a police officer with the Jefferson County Sheriff’s Office. 

This happened in March 2026, and the caller told Jane that she had two warrants for missing jury duty. What made the fake officer sound more convincing was that she even knew about her jury duty exemption in August 2025, so Jane was inclined to believe her.

The caller then transferred Jane to another fake officer who texted her forms and told her she owed $10,000 to clear the warrants.

After Jane said she could not pay $10,000, the caller lowered the demand to $2,500, then to $1,000. Jane drove to the bank and withdrew $1,000, which she then took to a CoinFlip ATM at a vape shop. 

An employee at the vape shop noticed and warned her that she was being scammed, but by then, the money was already gone. 

Jane called the ATM number to report what happened, but the CoinFlip employee told her the best they could do was refund her $182.38. Transaction fee. However, she did not remember any notice about transaction fees when she used the machine.

The third, but probably not the last, victim was affected in April 2025. She got a call from someone claiming to be from the Boone County Sheriff’s Office, informing her about her arrest warrant. 

The caller asked her to pay $9,600, but when she said she could not afford it, they told her to deposit $1,000 in a CoinFlip ATM.

She deposited $900, but when she tried to cancel the transaction after realizing it was a scam, it failed. She called CoinFlip, but they told her the money was already gone. 

What does CoinFlip say about itself, and what does the lawsuit say is really happening?

CoinFlip claims its ATMs are a “safe option” for buying Bitcoin. The lawsuit even cites the company’s own website, which claims its Know Your Customer process acts as “a roadblock from criminal activities.”

However, the lawsuit says all these claims are simply window dressing. According to the company documents cited in the lawsuit, CoinFlip knows scammers use its machines for fraud. 

The company even acknowledges that elder financial exploitation is “one of the fastest-growing forms of fraud” in its training materials. 

But despite all that, the lawsuit claims CoinFlip continues to process transactions because it earns a fee on each one. 

What are the hidden fees in this case?

The lawsuit claims that while CoinFlip displays a $2.99 fee on its ATM, the actual fee is hidden in its detailed Terms of Service document, which most people don’t read. These fees can even reach 21.9% of the total transaction value.

As per the lawsuit, if one person puts $100 into a CoinFlip machine, they only get about $75.76 worth of Bitcoin. That means more than 24% goes to CoinFlip, and the customer isn’t even informed about it. 

According to the office of the Attorney General, CoinFlip could easily display the full transaction fee on the screen, but it knowingly hides it because it earns from fees. 

The lawsuit is just part of a wider movement by US states to crack down on crypto ATM operators.

Bitcoin Depot was once the largest crypto ATM operator in North America with over 9,000 machines worldwide. However, the company filed for voluntary Chapter 11 bankruptcy in Texas last year after mounting legal judgments of over $25 million in the fourth quarter of 2025 alone.

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