Wednesday, August 15, 2018

AT&T Sued for Gross Negligence in Connection with Theft of #Crypto

Michael Terpin is one of the founders of a bitcoin investor angel group.  Recently, he filed a $224 million lawsuit against AT&T for a "digital identity theft" of his cellphone account (AT&T disputes the allegations) that led to the theft of his digital currency. 

So what happened?  Well, this all boils down to a SIM swap.  SIM = Subscriber Identification Module.  If you have a mobile phone, you most assuredly have a SIM card.  It authenticates who you are.  When a SIM is "swapped," essentially the provider (AT&T in Terpin's case) is tricked into transferring or swapping your phone number to someone else's SIM card (usually, the swapper).  Once that happens, it becomes very easy for the swapper to reset passwords and access accounts.  

Terpin is alleging that fraud and gross negligence on the part of AT&T was directly responsible for the SIM swap and the theft of his #crypto.  

Why is this important?

Well, first, I'm sure you're as freaked out as I am about having your SIM swapped.  So, there's that.  

Second, we will likely see more cases like this around the country that involve #blockchain technology and #cryptocurrency.  Likely, this technology will be inter-woven throughout business and the issues that arise.  Which raises questions about our current laws and procedural rules.  How should our laws be shaped to address this technology?  Should we change/supplement/modify our rules of civil procedure?  What about rules of evidence?  What experts will be used in cases like this?   I'm sure these and many more questions will be addressed by my colleagues at #ClevelandBlockLand.  

Finally, a significant amount of cryptocurrency has been stolen recently because of these SIM swaps. This incompetence with our security scares me and I, for one, am happy someone is doing something about it. Maybe this will force telecom companies to take privacy and security more seriously. 

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