Chicago-based Crypto Dispensers is exploring a potential $100 million sale just days after federal prosecutors unsealed an indictment against its CEO, Firas Isa. The U.S. Department of Justice has charged both Isa and his company with conspiracy to commit money laundering, creating a stark contrast between the firm’s growth ambitions and its legal troubles.

Federal Charges Unsealed

Prosecutors allege that Isa facilitated a $10 million laundering scheme through the company’s Bitcoin ATM network. The indictment claims that from 2018 onward, he knowingly accepted and converted proceeds from wire fraud and narcotics trafficking into cryptocurrency. According to the DOJ, Isa processed these illicit funds despite Know Your Customer (KYC) requirements and transferred the crypto to wallets designed to obscure their origin.

Both Isa and Crypto Dispensers have pleaded not guilty to the conspiracy charge. If convicted, Isa could face a maximum sentence of 20 years in federal prison. The company has not commented on how the pending criminal charges might impact a potential sale.

A Pivot to Software

In 2020, Crypto Dispensers shifted its business model away from physical ATMs to focus on software operations. The company cited rising fraud exposure, compliance pressures, and regulatory scrutiny as the primary reasons for the change. In a press release announcing the strategic review, Isa framed the potential sale as the next phase of the company’s growth but did not address the federal charges.

“Hardware showed us the ceiling. Software showed us the scale,” Isa stated, adding that the review aims to find the best path to maximize value. The company noted that it may continue to operate independently, as there is no guarantee a transaction will be completed.

Industry-Wide Scrutiny of Crypto ATMs

The case against Crypto Dispensers comes as crypto ATMs face mounting pressure from U.S. regulators. A recent FBI report highlighted nearly 11,000 scam complaints linked to crypto kiosks, resulting in over $246 million in losses. Lawmakers have increasingly scrutinized the machines for their perceived anonymity and role in facilitating illegal activities.

This has led several U.S. cities to take action. Stillwater, Minnesota, and Spokane, Washington, have implemented outright bans on the machines, with Spokane officials calling them a “preferred tool for scammers.” Other municipalities, like Grosse Pointe Farms, Michigan, have opted for restrictions, imposing a $1,000 daily transaction limit.