Head of Strategy of a crypto startup, VideoCoin, is the latest victim of SIM swapping, where he claims he lost nearly USD 1.8 million in cryptocurrencies.
According to the Seth Shapiro, the prosecution claims AT&T employees were active in a ring where they helped in hackers gain access to his SIM detail, effectively cloning the device and gaining access to his crypto wallets spread over 11 different exchanges. Mr. Shapiro submitted a 58 page complaint, where he detailed on how the nefarious act was made possible by using the cloned sim to get two factor authentication verified and breach the security of the wallets and exchanges to siphon off the digital assets,
“By utilizing their control over Mr. Shapiro’s AT&T cell phone number—and the control of additional accounts (such as his email) secured through that number by utilizing two factor authentication—these third-party hackers were able to access Mr. Shapiro’s accounts on various cryptocurrency exchange platforms, including the accounts he controlled on behalf of his business venture. The hackers then transferred Mr. Shapiro’s currency from Mr. Shapiro’s accounts into accounts that they controlled. In all, they stole more than $1.8 million from Mr. Shapiro in the two consecutive SIM swap attacks on May 16, 2018.”
Consensus to Coin Theft
The incident happened during the Consensus conference in New York during May 2018. During the conference, the VideoCoin executive noticed that his cellphone was not catching reception. To resolve the issue, he went to the AT&T store located in Manhattan, where the employees confirmed that his SIM card had been disabled because another was registered against his number.
Mr. Shapiro immediately got another SIM issued and bought another phone in order to stop any potential breach. He, however, was unsuccessful since the hackers had already gained access to his crypto accounts. They were subsequently able to move his funds out.
Chat logs retrieved by the prosecution shows that the hackers had inside help and had intimate knowledge of how many assets were stored in which account, “57 COINS. In bittrex. Trying to stay calm. Rn” said one hacker, while another replied “He probably has way more in other places. He has eth”.
The hackers were very active and they knew immediately when Shapiro had another sim issued. Another in the chat logged informed his accomplices, “He’s trying to get number back. I’m getting text messages.”
AT&T has had a streak of SIM swapping cases in the last couple of years and it has already been taken to court over SIM swapping related to crypto theft. The American telecommunications company has had a rather poor record of safety.
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