Investor Lawsuit Brought Against AT&T, T-Mobile for SIM Swapping Hacks

Leading cryptocurrency investor law firm Silver Miller Law has filed suit against cell phone giants AT&T and T-Mobile on behalf of several digital asset investors who were victims of the identity-theft tactic known as “SIM swapping.” The suit alleges that both companies possessed flaws in their security systems and failed to properly train their employees to work against hackers seeking to gain access to users’ smartphones.

SIM swapping occurs when a hacker gathers information on a potential victim, such as their phone password, answers to their security questions and their financial holdings. Once they have the data they need, the hacker will contact the person’s cell phone provider and claim that their SIM card has been lost or damaged and request that a new one be activated, with the end goal of accessing the victim’s finances — in this case, cryptocurrency.

The lawyers at Silver Miller Law claim that many of their clients had their crypto wallets drained via SIM swapping techniques, including one individual — an AT&T holder — who had roughly $621,000 stolen despite the phone company’s assurances that security had been beefed up following an earlier hack attempt on his account. Two other instances involved T-Mobile clients, who were ultimately robbed of $400,000 and $250,000 respectively.

This is not the only SIM jacking case brought against AT&T; the mobile carrier is also the subject of a separate $224 million lawsuit brought on by Michael Terpin, the founder of angel investment group BitAngels. Terpin claims that the company’s weak security protocols led to his loss of roughly $24 million in crypto funds through two separate SIM swap attacks.

In a deposition filed in August, Terpin claims that the hackers obtained access to his phone number with the help of an AT&T customer service representative. The hackers were then able to access his cryptocurrency wallet and steal funds.

Terpin states, “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.” He is now seeking roughly $200 million in damages.

Silver Miller Law has developed a reputation in the space for bringing investor-led lawsuits to court. Notable judgments and settlements in the firm’s history include Liu v. the Florida-based cryptocurrency exchange Cryptsy, in which roughly $50 million (approximately 11,300 BTC) was ordered returned to the company’s many traders and investors. It has also filed suits against Coinbase for its alleged mishandling of December 2017’s bitcoin cash listing.