FBI Arrests Alabama Man In January 2024 SEC X Hack That Boosted Bitcoin Price

WASHINGTON – Eric Council Jr., 25, of Athens, Alabama, was arrested this morning in Athens on charges of making unauthorized transfers to the US Securities and Exchange Commission (SEC) X account, formerly known as Twitter, in January 2024. Hackers posted a fake message from the SEC chair that caused the price of Bitcoin (BTC) to jump $1,000. Council is expected to make an initial appearance today in the Northern District of Alabama.

Council is charged in an indictment, unsealed today, with conspiracy to commit identity theft and access device fraud. United States Attorney Matthew M. Graves, Principal Deputy Attorney General Nicole M. of the Justice Department's Criminal Division. Argentieri was arrested and charged by FBI Acting Special Agent David Geist of the Washington Field Office's Criminal and Cyber ​​Division. and SEC Inspector General Deborah Jeffery.

According to the complaint, on January 9, 2024, Council conspired with others to take unauthorized control of the @SECGov X account (sometimes called the SEC's Twitter account) and send a fake post in the name of the SEC Chair, falsely declaring, in part, ” Today the SEC approves #Bitcoin ETFs for listing on all registered national securities exchanges.” Immediately after the tweet, the price of BTC rose by more than $1,000 per bitcoin.

Shortly after the unauthorized post, the SEC regained control of their X account and confirmed that the announcement was unauthorized and the result of a security breach. Following this corrective release, the price of BTC dropped by more than $2,000 per bitcoin. (At the time, the SEC was debating whether to authorize exchange-traded funds (ETFs) holding bitcoin.) An unauthorized actor gained control of the SEC X account through a “SIM swap.”

“These SIM swapping schemes, in which fraudsters trick service providers into giving control of their unsuspecting victims' phones, can result in devastating financial losses to victims and the leakage of sensitive personal and private information,” said US Attorney Graves. Those who commit this serious crime by using their illegal access to a phone through such charges will be held accountable.”

“The complaint alleges that Eric Council, Jr. unlawfully accessed the SEC's account at X using the stolen identity of an individual who accessed the account to obtain their cellphone number,” said Principal Deputy Attorney General Argentieri. “Council, Jr.'s co-conspirators then used this unauthorized access to X's account to falsely declare that the SEC had approved the listing of the Bitcoin ETF, causing the price of Bitcoin to rise by $1,000 and then fall by $2,000. Council's complaint underscores the Criminal Division's commitment to combating cybercrime, esp. when it threatens the integrity of financial markets.

“The FBI works to detect, disrupt and investigate cyber-enabled fraud, including SIM swapping,” said FBI Acting Special Agent in Charge Gist. “SIM swapping is a method that bad actors exploit to illegally access an individual or organization's sensitive information with intent to commit a crime. In this case, the unauthorized actor used SIM swapping to manipulate global financial markets. The FBI is holding those who violate US law accountable.” We will work tirelessly with our law enforcement partners across the country and around the world.”

“Today's arrests demonstrate our commitment to holding bad actors accountable for undermining the integrity of financial markets,” said SEC Inspector General Jeffrey.

A subscriber identity module (SIM) card is a chip that stores information to identify and authenticate a cell phone subscriber. When a cell phone carrier reassigns a phone number from one physical phone to another — such as when a customer purchases a new phone but wants to keep the same number — the carrier changes the cell phone number assignment from the old SIM card to the new phone's SIM card. phone, a process sometimes referred to as “porting” a number

A SIM swap attack refers to the process of fraudulently persuading a carrier to reassign a SIM card and telephone, a cell phone number controlled by a criminal actor, from the SIM card of a legitimate customer or user. A SIM swapping attack allows a criminal actor to bypass the multifactor authentication (MFA) and/or two-step verification process to access a victim's account so that the criminal actor can steal money and/or data from the victim or access the victim's online accounts.

As described in the complaint, the council, who used online monikers including “Ronin,” “EasyMuni,” and “AgentSchnauzer,” obtained personally identifiable information (PII) from the co-conspirators and an identification card template containing a victim's name and photo. The council then uses its identity card printer to create a fake ID with the information. The council proceeded to obtain a SIM card linked to the victim's phone line by presenting the fake ID at a cell phone supplier store in Huntsville, Alabama. He then bought a new iPhone with cash and used the two items to get access codes to the @SECGov X account. The council shared those codes with members of the conspiracy, who then accessed the account – and issued fraudulent tweets to the @SECGov X account in the name of the SEC chairman, falsely declaring the SEC's approval of the BTC ETF. Council receives BTC payment for successful SIM swap. Moments later, Council drove to Birmingham, Alabama to return the iPhone used in the SIM swap for cash.

He later covered “SECGOV hack”, “Telegram SIM swap”, “How do I know for sure I'm being investigated by the FBI” and “What are the signs that you are under investigation by law enforcement or law enforcement? The FBI even if they You are not contacted.”

The case is being investigated by the FBI Washington Field Office Criminal and Cyber ​​Division, the SEC-Office of Inspector General, the US Attorney's Office for the District of Columbia and the Department of Justice's Market Integrity and Major Frauds Unit (MIMF) and Computer. Crime and Intellectual Property Division (CCIPS). Significant assistance was provided by the FBI's Birmingham Field Office.

The prosecution is being handled by Assistant United States Attorney Kevin Rosenberg, and DOJ Trial Attorney Ashley Pungello and Paul Zebb of the Computer Crime and Intellectual Property Division and Lauren Archer of the Fraud Division. Valuable assistance was provided by John Hundscheid, Assistant United States Attorney from the Northern District of Alabama.

For more information on SIM swaps, visit: https://www.ic3.gov/PSA/2024/PSA240411

An accusation is merely an accusation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.