Court revives AT&T case over $24M crypto theft through SIM swap

A court has revived part of a 2020 case in which cryptocurrency investor Michael Terpin sued ATT after $24 million in crypto was stolen through a SIM swap scheme.

The case, which originally ruled in favor of ATT, has now been partially overturned on appeal, allowing Terpin’s claim under Section 222 of the Federal Communications Act to proceed.

The lawsuit dates back to a 2018 incident where Ellis Pinsky, then a 15-year-old high school student, bribed an ATT employee to transfer Terpin’s SIM card information to a blank card.

This allowed Pinsky to bypass two-factor authentication and gain access to Terpin’s cryptocurrency wallet, stealing $24 million worth of Trigger tokens.

While Terpin initially filed 16 claims against ATT, the Ninth Circuit Court of Appeals only reinstated the claim regarding ATT's responsibility to protect the SIM card information.

The court dismissed Terpin’s fraud claims and his demand for $216 million in punitive damages.

According to Terpin’s attorney, Pierce O’Donnell, Terpin now seeks $24 million plus interest, totaling at least $45 million, along with attorney’s fees.

Despite most of the claims being dismissed, the revived Section 222 claim could set an important precedent for phone companies' liability in future SIM swap-related cases.

Pinsky, who has been involved in a complex legal battle ever since, earned the nickname “Baby Al Capone” for his role in the theft.

He returned $2 million to Terpin and agreed to testify against ATT.

Terpin also sued Pinsky’s accomplice, Nicholas Truglia, for $75.8 million in 2019, winning the case.