T-Mobile takes a $33 million hit

T-Mobile has to pay $33 million in a case filed in the United States over crypto theft via SIM swapping.

The plaintiff in the case was Joseph “Josh” Jones, who was represented by California law firm Greenberg Glusker. In February 2020, he became the victim of a carefully executed SIM swapping attack.

According to T-Mobile, a threat actor managed to access the carrier’s systems and abused them for SIM swapping. Simply put, the attacker was able to transfer Jones’ phone number to a blank SIM card, which was under his control. That way, he was able to bypass the multi-factor authentication (MFA) on Jones’ crypto wallets.

The threat actor's action resulted in the theft of over 1,500 bitcoin and roughly 60,000 bitcoin cash, which had an estimated value of $38 million at the time.

Jones’ account at T-Mobile had heightened security, including an eight-digit PIN that should have prevented any changes. Therefore, he believes that the attacker might have used a backdoor on T-Mobile’s systems to take control of his account.

Greenberg Glusker argued in court that the SIM swap incident was caused by numerous security failures at T-Mobile. The judge agreed and awarded the law firm $33 million on liability and damages, including over $6.5 million in attorney’s fees, costs, and interest.

The law firm filed a petition with the Los Angeles Superior Court to confirm the award. The ruling, which dates back to the Fall of 2023, has been kept a secret ever since but is now public.

James Molen, one of Greenberg Glusker’s lawyers in this case, condemns this move by the carrier.

“T-Mobile was trying to hide the truth. They fought accountability at every turn, from blaming the victim to obstructing evidence production. The public has a right to know how their phone provider is putting them at risk, and we are confident the court will ensure transparency,” he said in a statement.

The law firm states that this victory in court reinforces consumer rights and emphasizes the urgent need for stronger and better protection against SIM card fraud.

“SIM swapping has been an unchecked security flaw for years. Carriers like T-Mobile have known about it and failed to take basic precautions. This award makes it clear: they must do better,” Greenberg Glusker’s Paul Blechner stated.