Fake Bitcoin approval tweet from SEC lands Alabama man in trouble

ATHENS, Ala. (WPMI) — An Alabama man was arrested Thursday morning by the FBI in Athens, Alabama, on charges related to the January hack of the Securities and Exchange Commission (SEC) social media account X, formerly known as Twitter.

According to court documents, on or about January 9, 25-year-old Eric Council Jr. of Athens allegedly conspired with others to seize unauthorized control of the SEC’s X account on behalf of SEC Chairman Gary Gensler Approval announced early by Bitcoin Exchange Traded Funds. Immediately after the false announcement, Bitcoin price rose by more than $1,000 per Bitcoin. Shortly after this unauthorized post, the SEC regained control of its X account and confirmed that the announcement was unauthorized and the result of a security breach. After this corrective disclosure, the value of BTC fell by more than $2,000 per Bitcoin.

The conspirators gained control of the SEC’s X account through an unauthorized Subscriber Identity Module (SIM) swap allegedly conducted by the Council. SIM swapping is the process of fraudulently inducing a mobile operator to reallocate a mobile phone number from the legitimate subscriber or user’s SIM card to a SIM card controlled by a criminal actor. As part of the scheme, the Council and co-conspirators allegedly created a false identification document in the victim’s name, which the Council used to impersonate the victim; took over the victim’s cell phone account; and accessed the online social media account linked to the victim’s cell phone number to access the SEC’s X account and create the fraudulent post in the name of SEC Chairman Gensler.

“The indictment alleges that Eric Council Jr. improperly accessed the SEC account in the Criminal Division of the Department of Justice. “Council co-conspirators then allegedly used this unauthorized access to the and then fell by $2,000.” The Council’s indictment underscores the Crime Division’s commitment to combating cybercrime, particularly when it threatens the integrity of financial markets.”

“These SIM swap schemes, in which fraudsters trick service providers into giving them control of unsuspecting victims’ phones, can result in devastating financial losses to victims and the loss of sensitive personal and private information,” said U.S. Attorney Matthew M .Graves for the District of Columbia. “Here, the conspirators allegedly used their illegal access to a telephone to manipulate financial markets. Through charges like these, we will hold accountable those who commit these serious crimes.”

“The FBI works to identify, prevent and investigate cyber fraud, including SIM swapping,” said Acting Special Agent in Charge David E. Geist of the FBI Washington Field Office’s Criminal and Cyber ​​Division. “SIM swapping is a method that criminals exploit to illegally access confidential information of an individual or company with the intent to commit a crime. In this case, the unauthorized actor allegedly used SIM swapping to manipulate the global financial market. The FBI will continue to work tirelessly with our law enforcement partners across the country and around the world to hold accountable those who violate U.S. laws.”

“This criminal indictment demonstrates our commitment to holding bad actors accountable for undermining the integrity of financial markets,” said SEC Inspector General Deborah Jeffrey.

A federal grand jury in the District of Columbia indicted the council on October 10, charging it with conspiracy to commit aggravated identity theft and access device fraud. If convicted, he faces a maximum sentence of five years in prison. A federal district court judge will decide the sentence taking into account the U.S. Sentencing Guidelines and other legal factors.

The FBI Washington Field Office and the SEC Office of Inspector General are investigating the case.

Trial Attorney Ashley Pungello of the Criminal Division’s Computer Crimes and Intellectual Property Section, Trial Attorney Lauren Archer of the Criminal Division’s Fraud Section, and Assistant United States Attorney Kevin Rosenberg for the District of Columbia are prosecuting the case.

For more information about SIM replacement, visit www.ic3.gov/PSA/2024/PSA240411.