Very sad... Did you read the TOS? Was the $5 mentioned on their website, on the screen of the ATM, somewhere? If not, i'd probably demand my $5 -$0.14 (the actual fee) = $4.86 back... The way i see it is that they can't just charge whatever they want...
They have to be clear about all the fees they'll charge beforehand...
But that's just my personal opinion
These bitcoin atm machines have a purpose and it is not for general trading. They are used either for convenience or totally anonymous trades. Usually these are proceeds from criminal activity looking to either store wealth or covert dirty funds
Do you have any proof for this claim? I've met several people that have used ATM's, and none of them did this to convert money from criminal activity or launder money. The people i've met used the ATM's because they're a fast and easy way to invest in BTC... You don't have to learn how exchanges work, you don't have to go trough the process of identifying yourself, you don't have to make a trade,...