The lawsuit, brought by Attorney General Brian Schwalb, claimed that Athena Bitcoin allowed scams to flourish through its kiosks and took advantage of users by not clearly stating the charges.

Athena Bitcoin began operating in DC in May 2024. Within the first five months, officials reported that the majority of transactions, around 93%, were connected to scams.

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Many of the affected users were elderly or otherwise vulnerable. Schwalb’s office alleged that one customer alone lost $98,000 through an Athena ATM.

Instead of using straightforward language to explain transaction costs, Athena Bitcoin reportedly used the term “Transaction Service Margin” in its Terms of Service. The word “fee” was never mentioned.

According to the attorney general, this wording misled users and prevented them from understanding the charges they were being assessed. The complaint stated that fees reached as high as 26% per transaction and were not shown clearly at any point during the process.

Additionally, Athena Bitcoin is accused of failing to implement proper anti-fraud protections. The complaint described the company’s machines as a “pipeline for illicit international fraud transactions” and alleged that the company turned a blind eye while continuing to profit.

The lawsuit also said the company does not allow users to recover lost funds, even in cases where scams are clearly involved. This approach left victims without a means to recover their money or even reclaim the fees they had been charged.

Recently, Taylor Thomson, a member of the Thomson Reuters family, lost over $80 million in cryptocurrency. How? Read the full story.

The case was submitted in federal court in Manhattan on June 24 and centers on a romance scam that began on Facebook.

According to the complaint, Zidell was contacted in January 2023 by someone using the name “Carolyn Parker”. She claimed to be a business owner, and over time, their online conversations grew more personal.

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After a few weeks, Parker was asked to invest in non-fungible tokens (NFTs). She recommended a specific platform and gave him steps to follow. Zidell agreed and began sending money to various bank accounts linked to the platform.

He was told that multiple banks were used to manage the high number of customer deposits. Zidell made 43 transfers totaling more than $20 million.

In April, the investment website had disappeared, along with all the money he had sent. Roughly $4 million of the total was directed to accounts held at Citibank under a company called Guju Inc.

Zidell said the bank allowed twelve transfers to go through without properly reviewing them. His complaint claimed that the size and pattern of the payments should have prompted further checks.

The lawsuit argued that Citibank overlooked activity that should have raised concerns. It stated that the bank did not properly monitor the account, failed to follow standard safeguards, and allowed suspicious transactions to continue without questioning them.

On June 25, AUSTRAC reported that a 77-year-old widow lost AU$433,000 in an 18-month Bitcoin
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