House committee adopts substitute strengthening consumer protections for cryptocurrency kiosks
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Summary
The House State Government Committee adopted a substitute to HB303 that adds fraud warnings, transaction disclosures, receipt and reporting requirements, daily and new-customer limits, and a ban on privacy coins at kiosks; the committee passed the measure by voice vote after sponsor testimony and industry consultation.
Representative Rustin Betsoe told the committee the HB303 substitute is aimed at preventing fraud at cryptocurrency kiosks used by scammers to extract money from victims. "The scammers out there ... are directing you to these devices that are located in stores" and the bill requires disclosures and fraud warnings at the point of transaction (SEG 740–758, SEG 774–786).
The substitute requires operators to display clear transaction disclosures, including U.S. dollar equivalents and exchange rates, and to present fraud warnings that a consumer must accept before proceeding. It also mandates physical or digital receipts containing operator contact information, transaction time and date, fees, receiving address and refund policy; digital receipts must be sent to the Alabama Securities Commission (SEG 810–829, SEG 823–828).
Sponsor Betsoe described technology and operational requirements to limit abuse: blockchain-analytics tools to block transactions linked to known fraudulent addresses, daily and per-transaction caps for new and existing customers (a new customer limited to $1,000 per transaction and $10,000 in a month during the first 30 days; existing customers limited to $10,500 per day), and a prohibition on privacy-enhancing "privacy coins" at kiosks (SEG 836–855, SEG 859–866). The bill also sets refund mandates for victims who file a law-enforcement report within 60 days; new customers would receive full refunds while established customers would receive half the transaction value plus fees (SEG 862–867).
The sponsor credited work with the Alabama Securities Commission and industry participants. "This bill has been in close concert and actually worked very hard on by director Amanda Senn and her team at Alabama Securities Commission," he said (SEG 830–833). Representatives from industry (CoinFlip and Bitcoin Depot) were described as having participated in discussions, according to the sponsor (SEG 781–786).
Committee members broadly supported the bill in remarks: Representative Shell described the legislation as a necessary protection for vulnerable consumers and lauded coordination with regulators (SEG 911–927). After questions and discussion the committee adopted the substitute and approved the bill by voice vote (SEG 729–736, SEG 970–978). The sponsor said enforcement authority and civil penalties would be administered by the Alabama Securities Commission and compliance must follow federal Bank Secrecy Act and USA PATRIOT Act requirements (SEG 883–887).
The committee record shows the substitute was adopted and the bill carried favorably out of committee; members indicated next steps would follow the usual legislative calendar.