CHICAGO, Ill. (WTWO/WAWV)— On Monday, Illinois Governor J.B. Pritzker signed two bills into law to protect natives from being affected by cryptocurrency scams.
The two acts are known as the Digital Assets and Consumer Protection Act (Senate Bill 1797) and the Digital Asset Kiosk Act (Senate Bill 2319). These two acts are said to be put in place to establish regulatory oversight of cryptocurrencies and create specific protections against scams and fraud for consumers who utilize digital asset kiosks.
According to the release from the Governor’s Office, both measures are needed to protect Illinois consumers amid more individuals falling victim to cryptocurrency scams. The FBI states that Illinois consumers lost $272,000,000 in fraud cases involving cryptocurrency last year. The FBI also stated that this was the most common type of financial fraud in the past year.
“While the Trump Administration is letting crypto bros write federal policy, Illinois is implementing common-sense protections for investors and consumers,” said Governor JB Pritzker. “At a time when fraudsters continue to evolve and consumer protections are being eroded at the federal level, Illinois is sending a clear message that we won’t tolerate taking advantage of our people and their hard-earned assets.”
Senate Bill 1787 more specifically grants the Illinois Department of Financial and Professional Regulation (IDFPR) the authority to regulate and supervise digital asset exchanges and other digital asset businesses. The act also creates strong customer protections in line with those that currently apply to traditional financial services, such as investment disclosures, customer asset safeguards, and customer service standards.
Companies in the digital asset marketplace will also be required to hold adequate financial resources to operate effectively and have procedures in place for addressing critical risks consistent with regulations for traditional financial services. These risks include cybersecurity, fraud, and money laundering.
“These initiatives modernize consumer protection and implement safeguards for all Illinoisans who choose digital asset services,” said IDFPR Secretary Mario Treto, Jr. “This is a monumental victory that prioritizes the safety and security of the people of Illinois, while also paving the way for a more transparent and accessible marketplace.”
Senate Bill 2319 will place new requirements on digital asset kiosk operators. Some of those requirements will be registering with the IDFPR, providing reports that detail all kiosk locations, and providing full refunds to new customers who are victims of scams at said kiosk. Transaction fees will also be capped at 18% at the kiosks, and daily transaction amounts will be capped at $2,500.
These bills come after the current administration stripped the IRS of its ability to regulate decentralized crypto brokers. Certain consumer protections included in the legislation are set to take effect immediately, such as the refunds for victims of fraud and scams, while others will happen later. Digital asset businesses will have until July 1, 2027, to register with the IDFPR.
