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Forest Lake adopts ordinance to register cryptocurrency kiosks after city reports $300,000 in kiosk fraud
Summary
Forest Lake City Council unanimously approved an ordinance to require hosting businesses to register cryptocurrency kiosks, impose a $2,000 annual registration fee for inspections and enforcement, and set operational and fraud-related restrictions after staff reported roughly $300,000 in kiosk-related losses locally.
Forest Lake City Council on Tuesday adopted an ordinance to register cryptocurrency kiosks in city limits, saying the move aims to curb fraud that city staff and police say is occurring at local kiosk machines.
Amanda (city staff) told the council the city documented about $300,000 in kiosk-related fraud between 2023 and 2024 and described how criminals use kiosks to quickly move stolen funds. "We saw $300,000 worth of fraud just through our kiosks located in our city alone," Amanda said, urging the council to act.
The ordinance (proposed as Ordinance 750) requires the hosting business — the gas station, grocery store or pharmacy that houses a kiosk — to register the kiosk with the city. Registration requirements in the ordinance include an annual $2,000 fee to fund inspections and enforcement, a copy of the kiosk operator's valid state license, a lease or rental agreement between the hosting business and operator, a Forest Lake Police Department confirmation that the operator has no more than two substantiated instances of fraud in the prior six months, conspicuous warning signage the city will provide, and a dedicated closed-circuit camera positioned to monitor the kiosk with required footage production within 48 hours of request.
Amanda said the fee covers Police Department inspections and ongoing compliance checks and that the registration targets the hosting business because kiosk operators may be difficult to locate. She told the council that state legislation now requires some operator licensing and disclosure and that nearby cities are considering similar local rules.
Chief Pearson expressed support for the ordinance, saying it "is a fantastic step in the right direction" and thanked staff and local detectives for their work on the issue.
Councilor S3 moved to enact Ordinance 750, and the motion was seconded and carried unanimously. Council later approved a companion resolution (Resolution 04142503) authorizing summary publication of the ordinance so it may be published and take effect as provided by law.
The ordinance does not ban kiosks outright; staff emphasized the registration approach is intended to protect consumers while allowing legitimate kiosk uses to continue under clearer requirements and enforcement.
Next steps: the council authorized summary publication of the ordinance; the city will begin implementing the registration process and enforcement steps outlined in the adopted language.
