The U.S. Securities and Exchange Commission has reached a legal resolution in a significant cybersecurity incident involving its social media presence, as Alabama resident Eric Council Jr. has pleaded guilty to compromising the SEC’s X account through a SIM swapping attack in January 2024. The incident underscores persistent vulnerabilities in SMS-based authentication methods that federal agencies have repeatedly warned against.
The 25-year-old perpetrator admitted to executing a SIM swap that gave him control over the phone number associated with the SEC’s X account. Through this access, Council reset the account password and posted fabricated information about Bitcoin ETF approvals, triggering substantial cryptocurrency market volatility. The attack method matches similar incidents that led the FBI and CISA to issue warnings about the risks of SMS-based two-factor authentication in government and enterprise systems.
The false announcement caused Bitcoin prices to surge by $1,000 before plummeting $2,000 after SEC Chair Gary Gensler issued a correction. Market data showed the BTC/USD trading pair dropped from $43,800 to $42,300 within a 30-minute window following the incident. On-chain metrics revealed a 10 percent increase in Bitcoin network transactions to 270,000 in the 24 hours after the hack, while the network hash rate maintained stability at 200 EH/s.
Under a proposed plea agreement, Council would forfeit $50,000 in proceeds obtained through the dissemination of false information. The forfeiture order awaits approval from U.S. District Judge Amy Berman Jackson. Council has pleaded guilty to conspiracy to commit aggravated identity theft and access device fraud, with sentencing scheduled for May 16, 2025. The charges carry a maximum prison term of five years.
The SEC confirmed the compromise of their @SECGov X account the day after the incident, specifically identifying a SIM-swapping attack targeting the phone number of the account administrator as the method of breach. The incident adds to a growing list of high-profile SIM swap attacks, which according to recent FBI reports, caused $48 million in losses during 2023 and have prompted calls for stronger authentication measures beyond traditional SMS-based verification.
Sources: BleepingComputer, Blockchain News, Binance
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