The Federal Bureau of Investigation has arrested a man in connection with the unauthorized takeover of the Securities and Exchange Commission’s social media account on X earlier this year.
Eric Council, Jr., of Athens, Ala., was taken into custody Thursday morning for posting a fake message from SEC Chair Gary Gensler in January that caused the value of Bitcoin to spike $1,000.
Council, 25, is charged with conspiracy to commit aggravated identity theft and access device fraud. He is scheduled to make an appearance Thursday in a Northern District of Alabama court.
The Justice Department indictment alleges Council conspired with other people to illegally take control of @SECGov on the social media site formerly known as Twitter on Jan. 9, 2024, saying, “Today, the SEC grants approval for #Bitcoin ETFs for listing on all registered national securities exchanges.”
At the time, the SEC was considering whether to allow Bitcoin in exchange traded funds. One day later, the SEC approved 11 Spot Bitcoin ETFs that hold the cryptocurrency in reserve and back each share with real Bitcoin.
Following the unauthorized post, the price of Bitcoin increased by more than $1,000, only to fall $2,000 after the SEC regained control of its account and said the announcement was not true and was instead the result of a security breach.
The Department of Justice alleges Council gained control of the SEC account by swapping a Subscriber Identity Module, or SIM card. SIM cards store information that identifies and authenticates a cell phone subscriber. A SIM swap attack is when someone fraudulently has a carrier reassign a cell phone number from a legitimate subscriber to one that’s controlled by a criminal who can then steal money or data from the victim by accessing the person’s online accounts.
Council allegedly accessed the SEC’s X account by stealing the identify of a person who had access to the SEC account to take over their cellphone number.
Council is accused of using a personal identification card containing a victim’s name and photo from unnamed co-conspirators and using an identification card printer to create a fake ID. He then presented the fake ID at a cell phone provider store in Huntsville, Ala., to purchase a new iPhone with cash and obtain a SIM card linked to the victim’s phone, enabling him to obtain access codes for the @SECGov X account.
The indictment alleges Council was paid in Bitcoin for performing the SIM swap, after which he returned the iPhone he had used for the swap.
Following the hack, the DOJ alleges Council performed internet searches for “telegram sim swap,” “SECGOV hack” and “how can I know for sure if I am being investigated by the FBI.”
“These SIM swapping schemes, where fraudsters trick service providers into giving them control of unsuspecting victims’ phones, can result in devastating financial losses to victims and leaks of sensitive personal and private information,” U.S. Attorney Matthew M. Graves said in a statement.
“Here, the conspirators allegedly used their illegal access to a phone to manipulate financial markets,” he said. “Through indictments like this, we will hold accountable those who commit these serious crimes.”
The case is currently under investigation by the FBI, the SEC, the U.S. Attorney’s Office and the Department of Justice.