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A pass judgement on on Friday sentenced an Alabama guy to 14 months in jail for his position within the January 2024 hack of the Securities and Exchange Commission’s X account, which was once used to ship out a tweet that in brief spiked the cost of bitcoin by means of greater than $1,000, the Justice Department mentioned.
The guy, Eric Council Jr., pleaded to blame 3 months in the past in U.S. District Court in Washington, D.C., to conspiracy to devote irritated id robbery and get right of entry to instrument fraud in reference to serving to others who took regulate of the SEC’s account.
The X account was once used to falsely declare that the SEC had formally authorized exchange-traded budget for bitcoin.
The cryptocurrency’s worth rose after that tweet, however then fell by means of greater than $2,000 after the SEC briefly regained regulate of the account and mentioned the tweet was once false.
Surveillance photos appearing Eric Council Jr. in a Huntsville, Alabama, AT&T retailer posing as an worker of the U.S. Securities and Exchange Commission.
Courtesy: U.S. District Court, Washington, D.C.
Ironically, the SEC mentioned day after today that it had authorized rule adjustments that allowed the introduction of bitcoin ETFs.
The 14-month sentence that Council won in D.C. federal courtroom was once 10 months not up to what was once asked by means of prosecutors, who in a sentencing memorandum this week mentioned {that a} staff that gives gear for hackers in February posted on X a video observation “purportedly made by the Defendant.”
In the video, the 26-old Huntsville resident Council “acknowledged his role in the hack and referenced his discussions with law enforcement and guilty plea as steps towards accountability, he blamed the SEC’s cybersecurity practices, claiming, ‘[t]he @SECGov Hack was an inside job’ and ‘the SEC still hasn’t taken full accountability for investor losses due to cyber security practices of a lonely 85- year-old with dementia,’ ” prosecutors wrote.
“Defendant ends the video with a message where he continued to diminish his and his conspirators’ culpability.
The animated video, depicting characters dancing, concludes by saying: “But on the finish of the day, the one explanation why their monetary regulatory company were given hacked was once as a result of a school drop out that majored in Cyber Security and violently smoked a large number of weed.”
Council’s defense lawyer, Dwight Crawley, in a sentencing memo, requested a prison term of 12 months and a day for his client, noting that he has no prior criminal history.
“The defendant admitted to the usage of marijuana day by day previous to his arrest, however he has now not had any drug or alcohol infractions since his free up on pre-trial supervision,” Crawley wrote.
“According to the defendant, his marijuana use aided him along with his psychological well being struggles.”
Crawley declined to comment on Council’s case when contacted by CNBC on Friday. The lawyer hung up when asked about the video cited by prosecutors.
Council’s role in the hack conspiracy involved executing a so-called SIM swap attack on a person whose phone number was linked to the SEC’s X account.
Council was tipped to the identity of that person by a member of the conspiracy and then used a portable ID car printer to print out that person’s driver’s license, court records state. He then used the ID at an AT&T store in Huntsville to get an employee there to reassign the victim’s cell phone number to a telephone controlled by Council, records said.
After gaining access to the victim’s phone number, “Council’s co-conspirators then accessed the account and posted within the identify of the SEC Chairman,” the Justice Department previously said.
At the time of the bogus tweet, the bitcoin market was awaiting news of a decision on bitcoin ETFs.
Council, who was known online by the handles “Ronin,” “Easymunny,” and “AGiantSchnauzer,” was paid in about $50,000 worth of bitcoin by co-conspirators for his role in the hack.
Prosecutors in their sentencing memo said that surveillance agents observed Council on June 12 trying to execute a SIM swap at an Apple store in Birmingham, Alabama.
On Jan. 18, “regulation enforcement performed a seek warrant of Defendant’s automotive and the Alabama place of dwelling the place he was once residing” and recovered a fake identification card in the name of victim [in the SEC hack] with Defendant’s image and a portable identification printer,” the memo mentioned.
“Law enforcement’s search of Defendant’s laptop uncovered templates for fake identification cards and internet searches for ‘SECGOV hack,’ ‘telegram sim swap,’ ‘how can I know for sure if I am being investigated by the FBI’ and ‘how long does it take to delete telegram account,’ ” the memo mentioned.
“Schemes of this nature threaten the health and integrity of our market system,” District of Columbia U.S. Attorney Jeanine Pirro mentioned in a observation.
“SIM swap schemes threaten the financial security of average citizens, financial institutions, and government agencies,” Pirro mentioned.
