A prison sentence was issued by the Department of Justice following the breach of the SEC’s social media account, through which a false announcement regarding bitcoin ETF approval was made, temporarily causing a surge in the cryptocurrency markets.
Hacker Sentenced by DOJ for SEC X Account Breach and Fake Bitcoin ETF Post
On May 16, the U.S. Department of Justice (DOJ) announced that Eric Council Jr., a 26-year-old resident of Huntsville, Alabama, received a 14-month prison sentence and three years of supervised release for his role in a cyberattack on the Securities and Exchange Commission’s (SEC) social media platform. Council pleaded guilty to conspiracy charges involving identity theft and access device fraud. Authorities reported that his dissemination of false financial information through the SEC’s account caused a brief but significant surge in Bitcoin’s price.
The Department of Justice (DOJ) stated that Council executed a SIM-swapping scheme to hijack a victim’s mobile service, enabling him and his accomplices to gain unauthorized access to the SEC’s official account on the social media platform X. After seizing control of the account, the group published a fraudulent post falsely announcing the approval of bitcoin exchange-traded funds (ETFs)—an event eagerly anticipated by investors. The DOJ noted that the fabricated statement caused an immediate impact on the cryptocurrency market.
Immediately following the false announcement, the price of BTC increased by more than $1,000 per BTC. Following the correction, the value of BTC decreased by more than $2,000 per BTC.
Council used a forged identification to impersonate the account holder and received compensation in bitcoin for his role in the scheme. On January 10, 2024, when the SEC formally approved spot bitcoin ETFs, BTC traded at approximately $46,000.
Federal authorities emphasized that such actions threaten the integrity of public markets. Darren Cox, Acting Assistant Director of the FBI’s Criminal Investigative Division, highlighted the concern:
The deliberate takeover of a federal agency’s official communications platform was a calculated criminal act meant to deceive the public and manipulate financial markets.
Authorities noted that Council attempted to undermine public confidence and exploit the financial system by disseminating false information to manipulate the markets.
