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Baltimore Officials Want To Unplug Phones-For-Cash Kiosks

Sep 7, 2013

EcoATMs take old cellphones, MP3 players and tablets in exchange for cash. But the automated kiosks, operating 650 machines in 40 states, are getting bad reviews from police, who are concerned the machines are a magnet for thieves.

The transaction is fairly simple. The machine walks you through the process, scanning your ID to certify you're over 18 and verify your identity. An ecoATM employee inspects the transaction remotely in real time. Once the seller's identity is verified, the kiosk takes the device and assesses its value. You get the cash, and the device is recycled.

The company was purchased in July by Outerwall, formerly called Coinstar, for $350 million. EcoATM officials are hoping the merger will speed the rollout of the machines in more places.

But in Baltimore, officials are trying to ban them.

"I had gotten complaints from the police department that people were stealing cellphones and taking them out to these machines in the county," says Baltimore City Council member Bill Henry.

The region has seen a rise in cellphone thefts. James Green, director of government affairs for the Baltimore Police Department, says ecoATM machines are among many places where stolen phones turn up. Green says law enforcement officials have been in talks with the company.

"We've made some recommendations as to how the data sharing can be improved, and the representatives of ecoATM are working on doing just that," he says.

EcoATM declined to be interviewed, but issued a statement saying they greatly appreciate the constructive engagement with law enforcement and the Baltimore City Council.

The company also has a page on its website dedicated to addressing "misperceptions" about the kiosks, outlining safeguards against the selling of stolen devices as well as how they use information about the individuals and devices in case theft is reported.

Washington, D.C., Metropolitan Police Chief Cathy Lanier is a vocal critic of the machines. Over the summer, she says her department's investigators traced 200 stolen cellphones to one ecoATM machine. When the D.C. police complained, Lanier says the company stopped giving her department information on phones turned in to its machines.

"Because there was some negative publicity around the use of these machines that fence stolen phones, and I was quoted in those articles, they stopped sending us the data," Lanier says.

The company has since resumed sending the information to D.C. police.

In California, the Riverside City Council banned the machines in August at the recommendation of its police chief, citing the same concerns expressed by Baltimore City Council member Henry and law enforcement officials.

EcoATM says on its website that "less than 1 out of every 4,000 devices" it collects are later reported lost or stolen.

Copyright 2013 WYPR-FM. To see more, visit http://www.wypr.org/.

Transcript

JACKI LYDEN, HOST:

By the way, do you have an old cellphone lying around? There's a company looking for them.

EcoATM has automated machines in cities across the country where you can recycle your old devices for cash. They're placed in public spaces. And officials in Baltimore are concerned the machines increase the incentives for cellphone theft.

Kenneth Burns from member station WYPR has more.

KENNETH BURNS, BYLINE: The ecoATM machines look like any stand-alone automated kiosk in any mall. The one I discovered was in the food court of the Security Square Mall outside of Baltimore. I was among the many that had an old phone at the bottom of a drawer in my house. I pressed the start button to begin selling my phone, and the machine walked me through its process.

(Reading) The first step is to estimate your device's value. I will ask you for your driver's license or ID to start the process. I need to make sure you're at least 18.

After I read the instructions, the machine scanned my driver's license and checked my identity. The transaction is inspected in real time by a real person in San Diego. The machine took the phone after everything is approved. In case you were wondering, my phone was worth nothing based on its condition. The transaction was easy.

For some officials, however, it's too easy. Baltimore City Councilman Bill Henry has proposed a ban on the machines.

BILL HENRY: I had gotten complaints from the police department that people were stealing cellphones and taking them out to these machines in the county.

BURNS: The region has seen a rise in cellphone thefts. James Green works for the Baltimore Police Department. He says ecoATM machines are among many places where stolen phones turn up and adds law enforcement officials have been in talks with the company.

We've made some recommendations as to how the data sharing can be improved, and the representatives of ecoATM are working on doing just that.

EcoATM declined to be interviewed but issued a statement saying they greatly appreciate the constructive engagement with law enforcement and the Baltimore City Council. D.C. Metropolitan Police Chief Cathy Lanier is a vocal critic of the machines. Over the summer, she says her department's investigators traced 200 stolen cellphones to one ecoATM. When D.C. complained, she says the company stopped giving her department information on phones turned in to their machines.

CATHY LANIER: Because there was some negative publicity around the use of these machines that fence stolen phones, and I was quoted in those articles, they stopped sending us the data.

BURNS: The company has since resumed sending the information to D.C. police. EcoATM has 650 machines operating in 40 states. The company was purchased in July by Outerwall, owners of Red Box and Coinstar, for $350 million. EcoATM officials are hoping the merger will help speed up rollout of the machines in more places. As officials in Baltimore were discussing the future of ecoATM here, the Riverside City Council in California recently banned the machines at the recommendation of their police chief, citing the same concerns expressed by Henry and other law enforcement officials. For NPR News, I'm Kenneth Burns in Baltimore. Transcript provided by NPR, Copyright NPR.