In January, bitcoin experienced a fleeting surge due to a fraudulent post circulating online, claiming to be from the Securities and Exchange Commission (SEC). Recently, an Alabama resident, 25-year-old Eric Council Jr., was arrested in connection with this incident. According to the AP, Council was apprehended on Thursday for allegedly assisting a group of hackers in breaching the SEC’s account on platform X to publish a misleading statement regarding the approval of bitcoin exchange-traded funds (ETFs). The deceptive post from January 9 stated, “The SEC grants approval for #Bitcoin ETFs for listing on all registered national securities exchanges,” prompting a more than $1,000 increase in bitcoin’s value, as noted by the Justice Department.
SEC Chair Gary Gensler later remarked, “The SEC has not approved the listing and trading of spot bitcoin exchange-traded products.” Although the agency eventually approved the bitcoin ETFs, this was only the day after the hackers’ fake announcement. The release revealed that Council allegedly utilized a “SIM swap” technique to assist the hackers in executing their scheme, which involved him using false identification at a cellphone provider in Huntsville to feign having access to the SEC’s X account. After purchasing a new iPhone with cash, he reportedly requested the store employee to provide him with the SIM card of the legitimate owner’s phone. Authorities assert that he later used that SIM card in his new iPhone to seize the real account holder’s information, allowing him to obtain the access codes for the SEC’s Twitter account.
Following this, Council allegedly shared the access codes with his hacker associates, who then broke into the SEC account and crafted the fraudulent post. Once the truth about the post emerged, bitcoin’s price plummeted by $2,000. The BBC reports that Council seemed to recognize the potential consequences of his actions; after returning the iPhone he had purchased, he conducted internet searches such as “How can I know for sure if I am being investigated by the FBI” and “What are the signs that you are under investigation by law enforcement or the FBI even if you have not been contacted by them,” according to the DOJ. Currently, Council faces charges of conspiracy to commit aggravated identity theft and access device fraud, with possible imprisonment of up to five years if found guilty. (More stories about hackers.)
