US entrepreneur and cryptocurrency investor Michael Terpin is suing AT&T for negligence and fraud that he claims resulted in millions of dollars worth of cryptocurrency tokens being stolen from his account. Terpin says AT&T was his mobile carrier when criminals accessed his cellphone account by carrying out SIM swap fraud. They then stole the tokens and allegedly transferred his account to an international criminal gang. Terpin is suing for the $23.8 million and an additional $200 million in punitive damages. AT&T told Reuters in a statement that it disputed these allegations.
SIM hijacking occurs when a phone number is transferred to a different SIM card than the account owner’s without authorization or approval. Having access to a phone number is a very valuable method of hijacking other digital accounts. Motherboard did a great rundown on the growing threat. The stolen phone number was used to hack Terpin’s account, and on January 7th, three million cryptocurrency tokens worth (at the time) $23.8 million were stolen. The complaint doesn’t specify which kinds of cryptocurrency Terpin had, but given that prices have fallen since January, the stolen tokens are likely worth far less now.
The complaint reads: “what AT&T did was like a hotel giving a thief with a fake ID a room key and a key to the room safe to steal jewelry in the safe from the rightful owner.” SIM card fraud that targets owners holding large amounts of cryptocurrency is a real phenomenon that US authorities have had to deal with in recent months.