Shocking SEC Hacker Sentencing Recommendation: 2 Years Sought for Eric Council

The cryptocurrency world was rattled in January 2024 by a fake announcement regarding the approval of spot Bitcoin ETFs posted on the official SEC X account. Now, the legal consequences for one individual involved are coming into focus. US prosecutors have formally requested a significant prison sentence for the person who pleaded guilty to a charge related to this security breach.

US Prosecutors Recommend Prison for SEC Hacker

In a recent court filing, the US government has recommended a two-year prison sentence for Eric Council Jr. Council pleaded guilty to a charge stemming from his involvement in compromising the Securities and Exchange Commission’s (SEC) social media account on X (formerly Twitter). The breach led to the unauthorized posting of a false message announcing the approval of spot Bitcoin (BTC) exchange-traded funds in January 2024, just a day before the official approval.

Why Prosecutors Seek a Two-Year Sentencing Recommendation for Eric Council

Filed on May 12 in the US District Court for the District of Columbia, the prosecution’s recommendation emphasizes the severity of Council’s actions. They argue that the case warrants a sentence within the established guidelines range. Prosecutors stated, “Defendant profited through a sophisticated fraud scheme involving fraudulently produced identification documents, a series of misrepresentations at telecommunication stores, and the transmission of password reset codes for victim online accounts to co-conspirators located in the United States and abroad. This conduct deserves a significant penalty.” This highlights the multi-layered nature of the crime, extending beyond just the SEC account compromise.

The SEC X Account Hack and Its Impact

Eric Council Jr. was part of a group that gained unauthorized access to the SEC’s X account through a SIM swap attack. This technique allowed them to intercept password reset codes, giving them control over the regulator’s official social media presence. The fake post announcing the spot Bitcoin ETF approval caused immediate market volatility, with the price of Bitcoin surging briefly before the SEC quickly refuted the false claim and later issued the actual approval. The incident underscored the potential market manipulation risks associated with compromised official channels, especially concerning highly anticipated events like the Bitcoin ETF decision.

What’s Next for Eric Council?

As of the May 12 filing, Eric Council’s legal team had not publicly filed a response to the government’s sentencing recommendation. Council is scheduled to appear before Judge Amy Berman Jackson for sentencing on May 16. The judge will consider the prosecution’s recommendation, the defense’s arguments (if any are filed), and the sentencing guidelines before making a final decision on the prison term. The outcome of this case is being closely watched as it relates to cybercrimes impacting financial regulators and market integrity.

Conclusion: Accountability for the Bitcoin ETF Fakeout

The sentencing recommendation for Eric Council Jr. marks a significant step in holding individuals accountable for the unauthorized access and fake Bitcoin ETF announcement on the SEC X account. The government’s request for a two-year prison sentence reflects the perceived seriousness of the crime, citing a sophisticated fraud scheme. The final sentence, to be determined by the judge, will serve as a notable outcome in a case that briefly sent ripples through the crypto market and highlighted vulnerabilities in official communication channels.