By Barry Eitel
Entrepreneur Michael Terpin filed a $224 million lawsuit against AT&T Wednesday, alleging that the telecommunications company’s negligence resulted in the theft of his digital currency.
The complaint, filed with the United States District Court in Los Angeles, charges that hackers were able to convince AT&T employees in January to provide them access to Terpin’s accounts in a scheme known as a “SIM swap”.
Once access was granted, the hackers absconded with $23.8 million of cryptocurrency owned by Terpin. The investor is also seeking $200 million in punitive damages, noting that AT&T was warned of such scams by law enforcement before the hacking.
“AT&T is doing nothing to protect its almost 140 million customers from SIM card fraud,” the lawsuit says.
“AT&T is therefore directly culpable for these attacks because it is well aware that its customers are subject to SIM swap fraud and that its security measures are ineffective. AT&T does virtually nothing to protect its customers from such fraud because it has become too big to care.”
Terpin’s attorneys said that SIM swap hackings are often coordinated with unscrupulous AT&T employees who sell off the sensitive information of victims.
“Somebody needed to sue AT&T for fraud and gross negligence in letting criminals SIM swap,” Terpin posted on Twitter. “I just did.”
AT&T plans to fight Terpin in court.
“We dispute these allegations and look forward to presenting our case in court,” an AT&T spokesman said in a statement.
Terpin has long been an advocate for cryptocurrencies. He co-founded an angel investment firm for digital currency start-ups, BitAngels, in 2013.