A Texas resident, Plaintiff Jamarquis Etheridge, filed the suit in the state’s District Court on September 15. In the suit, Etheridge is alleging that AT&T failed to offer reasonable and appropriate security to prevent unauthorized access to his wireless account.
Around September 10, bad actors managed to infiltrate Etheridge’s wireless account without authorization and drain his crypto account. AT&T was slow at reacting and unable to contain the security breach until the next day.
$560,000 In Cryptocurrency Stolen
The plaintiff has been a client of AT&T since 2009. He was unable to use his cell phone number to resolve that incursion and ended up losing 159.8 in ETH worth around $560,000 at the time.
This attack, known as SIM swapping, is a type of fraud that exploits phone-based validation. Scammers normally find out the victim’s phone number from social media, online data, and stolen devices. They then call the carrier, AT&T for this incident, posing as the victim.
The thief then asks the carrier to activate a new SIM in their possession and proceeds to port the victim’s number to the new SIM. They then access financial accounts that rely on the phones for validation methods like one-time SMS passcodes.
AT&T was aware of that threat and even posted warnings but it still did not do enough to protect the user, the complaint said.
“As a result of AT&T’s failures if not active participation in SIM swap theft that was inflicted upon him, Plaintiff Etheridge has had over 159.8 ETHEREUM Tokens of assets stolen from him.”
Etheridge said that he is seeking compensation for the sum of Ethereum that was stolen. The complaint also questions the carrier’s marketing materials that allege that AT&T takes adequate ‘measures to ensure’ they are communicating with the genuine person and not a criminal.
There was an increase in SIM swap threats in December 2021, after the many leaks of consumer data from Ledger servers. The hardware wallet manufacturer has never compensated the victims of shoddy security practices.
That Is Not The First Incident
The crypto investor Seth Shapiro sued AT&T in December 2019 when he lost $1.8 million in crypto in a similar SIM swap attack and an alleged failure by the carrier to protect its clients.
Michael Terpin, another SIM swap victim, alleged that he lost $24 million in crypto as a result of AT&T’s negligence in 2018 in a similar attack. In November of that year, California resident Robert Ross lost $1 million worth of crypto after a hacker managed to gain control of his AT&T phone.
The telecoms company has now pushed back against past lawsuits and might do so with this latest one.
