Guilty Plea in High-Profile Cybercrime Case
An Alabama man admitted Monday to his involvement in the January 2024 hack of the U.S. Securities and Exchange Commission’s social media account, a scheme that briefly caused bitcoin’s price to surge. Eric Council Jr., 25, pleaded guilty to an identity theft charge in U.S. District Court in Washington. His sentencing is scheduled for May.
Council was arrested in October and charged with assisting in the breach of the SEC’s account on X, formerly known as Twitter. Prosecutors said he worked with unidentified co-conspirators to falsely announce the approval of long-awaited bitcoin exchange-traded funds, misleading investors and temporarily driving up bitcoin’s value.
Bitcoin Price Surge Followed Fake SEC Announcement
The unauthorized post from the SEC’s account claimed that the agency had approved bitcoin ETFs for listing on all registered national securities exchanges. The news sent bitcoin’s price climbing from about $46,730 to just under $48,000 before the SEC publicly denied the claim. Once then-SEC Chairman Gary Gensler confirmed that the account had been compromised, bitcoin’s price dropped to around $45,200.
The actual approval of bitcoin ETFs by the SEC came a day later, adding to the confusion in the market. Since then, bitcoin’s price has continued to rise and is now trading around $100,000.
How the Hack Was Carried Out
According to prosecutors, Council executed a SIM swap scam to gain unauthorized access to the SEC’s social media account. Using a fake ID, he impersonated someone with account access and convinced a cellphone store employee to issue him a new SIM card linked to the victim’s phone number. This allowed him to intercept security codes and log into the SEC’s account. Once inside, he provided the access credentials to others, who then posted the misleading bitcoin ETF announcement.
Financial Gains and FBI Investigation
Prosecutors said Council was compensated for his role in the scheme with bitcoin payments totaling approximately $50,000. Authorities also revealed that before his arrest, Council’s internet search history suggested he was concerned about being caught. He searched for information on how to determine if he was under FBI investigation and looked up federal identity theft statutes.
His guilty plea is a significant step in the federal government’s crackdown on financial cybercrimes. His sentencing in May will determine the penalties he faces for his role in the scheme.
