The recent cybersecurity breach of the U.S. Securities and Exchange Commission (SEC) has drawn significant attention, particularly due to the implications on cryptocurrency markets. In connection with this high-profile case, prosecutors are reportedly preparing a plea deal for Eric Council Jr., the man accused of orchestrating the hack of the SEC’s official X account.
Details of the SEC Hack
The incident, which occurred in January, involved the unauthorized posting of a misleading message claiming that spot Bitcoin Exchange-Traded Funds (ETFs) had been approved for listing. This fabricated announcement was released just before the SEC’s official statement on the matter, causing a notable spike in Bitcoin’s price, which surged by over $1,000 as investors reacted to the false news.
Charges Against Eric Council Jr.
Eric Council Jr. was arrested last week and faces serious charges, including conspiracy to commit aggravated identity theft and access device fraud. Prosecutors believe that Council did not act alone but rather was part of a larger scheme involving unidentified co-conspirators who played crucial roles in executing the hack.
Plea Deal Considerations
During a recent hearing in the U.S. District Court in Washington, D.C., Assistant U.S. Attorney Kevin Rosenberg announced the government’s plans to offer a plea deal to Council. Rosenberg stated, “We will extend a plea; I have no idea if it will be accepted or not,” indicating the uncertain nature of Council’s response. Should he choose to accept the deal, there is potential for his cooperation to help federal authorities in identifying and prosecuting others involved in the conspiracy.
Method of the Attack
The prosecution’s case outlines that Council and his associates utilized SIM swapping—a technique that involves fraudulently transferring a victim’s phone number to a new SIM card in order to gain access to sensitive accounts. It is alleged that Council gathered personal information about a victim, including their name and photo, which he used to create a fake identification. Armed with this bogus ID, he was able to visit an AT&T store in Huntsville, Alabama, where he acquired a SIM card linked to the victim’s phone number. Subsequently, using a new iPhone purchased with cash, Council accessed the SEC’s social media account by retrieving necessary access codes.
Next Steps in the Legal Proceedings
The case is being overseen by Judge Amy Berman Jackson, known for her involvement in other significant SEC-related matters, including a case against Binance. If a plea deal is successfully negotiated, both the prosecution and Council’s legal team must file the proposed plea documents by December 4, according to the court’s guidelines. Through Council’s potential cooperation, prosecutors hope to uncover more information about the conspiracy, shedding light on the broader network behind the attack on the SEC.