The Block: Crypto investor writes open letter to FCC chairman on ‘growing cancer’ of SIM swapping

U.S. entrepreneur and cryptocurrency investor Michael Terpin has written an open letter to Ajit Pai, chairman of the Federal Communications Commission (FCC), requesting action on SIM swapping fraud.

In the letter, shared with The Block on Monday, Terpin, a victim of SIM swapping himself, described the method of fraud is the “fastest growing cancer” on the mobile consumer landscape, and said it needs to end “quickly and effectively.”

To that end, Terpin suggested three remedies to Pai: 1. Mandating all U.S. mobile carriers to hide customer passwords from employees; 2. Mandating all U.S. mobile carriers include a “no port” option, meaning users would have to go through a carrier’s fraud department to transfer their SIM information; and 3. Initiating an “immediate, comprehensive” study (which was done for robocalls) with recommendations for mandatory reforms by carriers.

"These first two measures are easy to implement: the first would simply require using a phone keypad to punch in the numbers, something every carrier already uses for other commands, and the second would mandate a policy that some, but not all, carriers already offer,” said Terpin.

Last August, Terpin sued AT&amp;T for $224 million after his SIM got swapped by hackers, allegedly resulting in the loss of around $24 million in cryptocurrencies (compensatory damages) and a further $200 million in punitive damages. In response, AT&amp;T filed a motion to dismiss, saying that Terpin had failed to state a claim upon which relief could be granted. A court, in turn, granted Terpin a period to amend his lawsuit.

In another case, Terpin had also sued 21-year-old Nicholas Truglia for accessing his funds via a SIM swap hack. Terpin won that case as a court ordered Truglia to pay him $75.8 million in compensatory and punitive damages.