WASHINGTON (7News) — D.C. Attorney General Brian L. Schwalb filed a lawsuit Monday morning against Athena Bitcoin, Inc., accusing the company of “financially exploiting District residents” through its cryptocurrency ATMs.
The lawsuit alleges that 93% of deposits made into Athena’s Bitcoin Teller Machines (BTMs) were linked to scams, many of which targeted seniors and vulnerable residents.
According to the Office of the Attorney General for the District of Columbia (OAG), Athena knowingly profited from illegal, hidden fees while failing to implement anti-fraud protections.
Officials found that nearly half of all deposits at Athena’s seven D.C. machines were flagged as fraudulent.
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According to the company’s own data from its first five months of operations in D.C.:
- 93% of all Athena BTM deposits were the direct result of scams
- Nearly half of all deposits were flagged to Athena as the product of fraud
- The victims’ median age was 71
- The median amount lost per scam transaction was $8,000, with one victim losing a total of $98,000 in nineteen transactions over a period of several days
“Athena’s bitcoin machines have become a tool for criminals intent on exploiting elderly and vulnerable District residents,” said Schwalb. “Athena knows that its machines are being used primarily by scammers yet chooses to look the other way so that it can continue to pocket sizable hidden transaction fees. Today we’re suing to get District residents their hard-earned money back and put a stop to this illegal, predatory conduct before it harms anyone else.”
The OAG also claims that Athena charges fees of up to 26% without disclosing them. When scam victims request refunds, Athena enforces a “no refunds” policy.
OAG’s lawsuit alleges Athena violates the District’s Consumer Protection Procedures Act and Abuse, Neglect, and Financial Exploitation of Vulnerable Adults and the Elderly Act by:
- Facilitating financial scams. Athena is well aware that the safeguards it has implemented are insufficient to protect customers from fraud. Athena’s own logs show that during its first five months of operation in the District, 48% of all funds deposited in the company’s BTMs resulted in consumers reporting directly to Athena that they had been the victim of a scam.
- Illegally profiting from hidden fees. Athena BTMs charge District consumers fees of up to 26% per transaction without clearly disclosing them at any point in the process. Bitcoin purchased through other apps and exchanges typically have fees of 0.24% to 3%. In June 2024, Athena added a confusing and misleading reference to a “Transaction Service Margin” in its lengthy Terms of Service, but the magnitude of the margin is never disclosed, nor is the word “fee” ever mentioned.
- Refusing to refund victims of fraud. Athena further deceives users through a refund policy that either outright denies scam victims refunds or arbitrarily caps them, even though Athena could easily return the hidden transaction fees it pockets. Athena also requires fraud victims to sign a release that frees the company of all future liability and blames victims for not sufficiently heeding onscreen BTM warnings.
With this lawsuit, Schwalb’s office is seeking restitution for victims, civil penalties, and an order requiring Athena to change its business practices.
Resources for District residents:
- Resources to help residents learn hw to detect, prevent, and report abuse of the elderly or vulnerable can be found here.
- File a report with Adult Protective Services (APS) by calling the 24-hour hotline at (202) 541-3950
- File a police report with the Metropolitan Police Department (MPD) by calling the police at (202) 265-9100
- Contact OAG’s Civil Rights and Elder Justice Section at (202) 727-3807 or elderjustice@dc.gov
