A Texas county has reached a settlement in a lawsuit involving the wrongful seizure of $15,000 from a Bitcoin ATM operated by Lux Vending, known as Bitcoin Depot. The lawsuit was dismissed after the county acknowledged the funds were unlawfully taken due to a scam targeting an 82-year-old woman in Crawford. She was deceived into withdrawing $15,000 in cash and depositing it into the Bitcoin ATM after falling victim to a ransomware attack via a malicious email link.
Initially, legal action had been taken against county investigators for violating due process when they obtained a warrant to seize the funds from a Bitcoin Depot kiosk located at a Sunoco store. The lawsuit also aimed to establish Bitcoin Depot as the rightful owner of the seized money.
Sheriff Parnell McNamara, who had previously supported his officers’ actions, declined to comment on the lawsuit’s resolution or Judge Scott Felton’s acknowledgment that the funds were seized in error.
Wrongful Seizure of Bitcoin ATM Funds in Texas County Resolved
Judge Felton clarified that the initial seizure was based on the mistaken belief that the funds belonged solely to the elderly victim, and county officials were unaware of Bitcoin Depot’s terms and conditions when the money was returned to her.
The settlement reportedly did not involve any payments to Bitcoin Depot, as the company sought official acknowledgment that it was not involved in the scam, which was the work of a third-party international fraudster.
McLennan County is part of the wider network of Bitcoin ATMs operated by Bitcoin Depot, which has over 6,625 machines across the US, representing a 9.8% market share as of October.