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SIM-Swap Arbitration Win Against T-Mobile (Jones v. T-Mobile)

When clients ask whether a SIM-swap victim can actually prevail against a carrier, this matter provides a clear, document-backed example: Joseph “Josh” Jones brought claims against T-Mobile in private arbitration—and won.

What happened—and why SIM swap mattered

On February 21, 2020, attackers convinced T-Mobile to move Jones’s phone number to a SIM card they controlled. From there, they intercepted two-factor authentication (2FA) messages, reset credentials, accessed private files, and transferred cryptocurrency out of Jones’s wallets.

As Jones’s filing puts it, “The SIM swap was an absolutely necessary, indispensable component of the hack, without which Mr. Jones’s cryptocurrency could never have been accessed, much less stolen.”

Jones alleges T-Mobile had previously given him an eight-digit “heightened security” PIN in 2018—but the hackers were not required to provide it when they commandeered the line.

The theft was massive: over 1,500 Bitcoin and almost 60,000 Bitcoin Cash, valued at approximately $38 million at the time, with damages alleged to exceed $165 million measured by post-theft highs.

According to the First Amended Demand for Arbitration, “Once the perpetrators gained unauthorized access to Mr. Jones’s wallets, they transferred over 1,500 Bitcoin and almost 60,000 Bitcoin cash of cryptocurrency belonging to Mr. Jones to wallets and/or accounts under their control.”

Forum, case & decision-maker

The dispute was arbitrated before ADR Services, Inc. as ADRS Case No. 20-5769-RJM, with Hon. Rita “Sunny” Miller (Ret.) presiding. The caption lists Joseph “Josh” Jones as Claimant and T-Mobile USA, Inc. as Respondent.

Jones’s First Amended Demand for Arbitration is dated April 16, 2020, confirming the matter was underway by spring 2020.

The arbitration result

Arbitrator Miller issued an Interim Award dated December 20, 2023, which was incorporated by reference into the Final Award.

In separate fee proceedings, the Arbitrator granted $5,957,902.56 in attorneys’ fees, $312,259.91 in costs, and prejudgment interest commencing September 29, 2023 at the federal rate under 28 U.S.C. § 1961.

Confidentiality note

T-Mobile requested that the Interim Award (incorporated into the Final Award) be filed under seal in court. Because of that sealing request, the public court file does not display the merits-award details; the petition references and conditionally lodges the Interim Award in a separate appendix.

Current court status: Petition to confirm the award

Following the arbitration victory, Mr. Jones took steps to ensure the award would be recognized and enforceable by the courts.

A Petition to Confirm the Arbitration Award was filed in the Superior Court of California, County of Los Angeles (Santa Monica Courthouse) on March 20, 2025. The court case is Jones v. T-Mobile USA, Inc., Case No. 25SMCP00148, classified as an unlimited civil petition to confirm the private arbitration result.

Filing this petition is a procedural step that asks the court to convert the arbitration award into an official judgment, which can then be used to collect the damages if necessary.

Since the filing, there has been ancillary litigation over confidentiality. T-Mobile and other interested parties moved to seal certain records (such as the detailed arbitration award and supporting documents) from the public file, citing privacy and security concerns.

The Superior Court scheduled hearings to address these motions to seal. One such motion was heard in August 2025 (with the judge taking the matter under submission on August 7, 2025).

Another related hearing on a motion to seal (specifically concerning portions of the arbitration records) is scheduled for September 4, 2025 in the Santa Monica Courthouse. These hearings will determine which parts of the arbitration award documentation, if any, will remain confidential despite the confirmation proceeding.

In the meantime, the case continues toward a likely confirmation of the award, with a case management conference also set for August 25, 2025.

The petition to confirm remains pending, and the Superior Court is currently addressing what portions of the arbitration record, if any, will remain sealed as the confirmation proceeding moves forward.

What this means for SIM-swap victims

This matter shows, in practice, how a carrier can be held liable when a SIM-swap compromises a customer’s accounts and leads to large-scale crypto losses: an arbitration win, followed by a petition to confirm the award in court. (Because portions of the award are under seal, the public file does not state the merits-award amount; only the fee/cost/interest ruling is visible.)

Contact Us

At Dilendorf Law Firm, we represent clients who have been targeted by SIM-swap attacks and other forms of cyber fraud.

With over six years of experience and a record of handling more than 100 consumer arbitration cases, we have successfully pursued claims against both major cryptocurrency exchanges—including Coinbase, Gemini—and leading phone carriers such as Verizon, T-Mobile, and AT&T.

Our attorneys are skilled in navigating proceedings before all major arbitration forums, including AAA, JAMS, and NAM.

We also represent victims whose digital assets were stolen not only from regulated exchanges but also from self-custody wallets like MetaMask and other decentralized platforms.

In high-stakes cases, we advise and coordinate with U.S. law enforcement and investigative agencies—including the FBI, Department of Homeland Security (DHS), and the Secret Service—as part of broader recovery strategies and criminal investigations into cybercrime.

If you have suffered losses due to a SIM swapping incident or other cyber fraud, contact us to discuss your case and options for recovery.

Email: info@dilendorf.com | Phone: 212.457.9797

 

Disclaimer: The case discussed above is provided for informational purposes only. The Claimant in this matter was not represented by Dilendorf Law Firm, and this case is not affiliated with our firm in any way.

Executive summary

For U.S. families evaluating Cook Islands asset-protection trusts, FTC v. Affordable Media, LLC, 179 F.3d 1228 (9th Cir. 1999), remains the most instructive federal appellate decision. The opinion:

  • describes trust provisions “intended to frustrate the operation of domestic courts,” Id. at 1232;
  • affirms that repatriation orders and civil contempt are available remedies when assets are placed offshore for a settlor’s benefit, Id. at 1231–32; and
  • expresses pronounced skepticism where a settlor claims to have retained no control while circumstances indicate otherwise, Id. at 1241–42.

What follows is a concise, professionally neutral synthesis anchored in the court’s own language.

How the Ninth Circuit framed the structure and its purpose

The court characterized the trust mechanics directly: “…the provisions of the trust were intended to frustrate the operation of domestic courts.” FTC v. Affordable Media, LLC, 179 F.3d 1228, 1232 (9th Cir. 1999).

It also summarized the broader model at issue: “These ‘so-called asset protection trusts’ are designed to shield wealth by moving it to a foreign jurisdiction that does not recognize U.S. judgments or other legal processes, such as asset freezes.” Id. at 1240.

Court orders and immediate consequences

From the outset, the directives were unambiguous: “Both the temporary restraining order and the preliminary injunction required the Andersons to repatriate any assets held for their benefit outside of the United States.” Id. at 1232.

When the orders were defied, the panel endorsed the district court’s use of contempt:

“An old adage warns that a fool and his money are easily parted. This case shows that the same is not true of a district court judge and his common sense. After the Andersons refused to comply with the preliminary injunction by refusing to return their illicit proceeds, the district court found the Andersons in civil contempt of court.” Id. at 1231.

The “duress” sequence—and why impossibility failed

The opinion recounts how duress provisions operated when a U.S. order issued:

“In response to the preliminary injunction, the Andersons [sent] a letter to AsiaCiti on May 12, 1998, instructing AsiaCiti to provide an accounting of the assets held in the trust and to repatriate the assets to the United States to be held under the control of the district court. AsiaCiti thereupon notified the Andersons that the temporary restraining order was an event of duress under the trust, removed the Andersons as co-trustees under the trust because of the event of duress, and refused to provide an accounting or repatriation of the assets.” Id. at 1233.

Further attempts to substitute trustees met the same response:

“In attempting to purge themselves of their contempt, the Andersons attempted to appoint their children as trustees of the trust, but AsiaCiti removed them from acting as trustees because the event … of duress was continuing. At the June 17 hearing, the district court indicated that it believed that the Andersons remained in control of the trust and rejected their assertion that compliance with the repatriation provisions of the trust was impossible.” Id. at 1233.

The panel then addressed the core defense:

“The Andersons claim that the refusal of the foreign trustee to repatriate the trust assets to the United States, which apparently was the goal of the trust, makes their compliance with the preliminary injunction impossible.” Id. at 1239.

Its conclusion was unequivocal:

“It is readily apparent that the Andersons’ inability to comply with the district court’s repatriation order is the intended result of their own conduct— their inability to comply and the foreign trustee’s refusal to comply appears to be the precise goal of the Andersons’ trust.” Id. at 1240.

The court tied that outcome to specific drafting:

“The Andersons’ trust created the circumstances in which a foreign trustee would refuse to repatriate assets to the United States by means of so-called duress provisions.” Id. at 1239 n.9.

And it signaled the limited role of “impossibility” in this context:

“Given that these offshore trusts operate by means of frustrating domestic courts’ jurisdiction, we are unsure that we would find that the Andersons’ inability to comply with the district court’s order is a defense to a civil contempt charge. We leave for another day the resolution of this more difficult question because we find that the Andersons have not satisfied their burden of proving that compliance with the district court’s repatriation order was impossible.” Id. at 1241.

Judicial skepticism regarding “no control”

The opinion repeatedly notes doubt that a settlor truly surrendered control:

“Given these considerations, we cannot find that the district court clearly erred in finding that the Andersons’ compliance with the repatriation order was not impossible because the Andersons remain in control of their Cook Islands trust.” Id. at 1241.

“While it is possible that a rational person would send millions of dollars overseas and retain absolutely no control over the assets, we share the district court’s skepticism.” Id. at 1242.

That skepticism was informed by the overall record, including the court’s description of the Andersons’ initial position:

“The Andersons claimed that they were unable to repatriate the assets in the Cook Islands trust because they had willingly relinquished all control over the millions of dollars of commissions in order to place this money overseas in the benevolent hands of unaccountable overseers, just on the off chance that a law suit might result from their business activities.” Id. at 1231.

A candid passage the court reproduced—and its import

The panel quoted a description of how an offshore trust might be defended in U.S. court:

“Finally, the settlor should be aware that, although his trust will probably prove unassailable by domestic creditors, he may face minor hassles while defending his trust in court. In particular, if a creditor attacks an offshore trust in United States court, the settlor may face contempt of court orders during the proceedings. . . . There is a possibility that the court will . . . order the settlor to collect his assets from the trust and turn them over to the court. If the settlor does not comply with these orders, a court may hold him in contempt. However, there are ways around such a conflict. . . . The settlor could comply with the court order and ‘order’ his trustee to turn over the funds, knowing full well that the trustee will not comply with his request. Thereby, the settlor would technically comply with the court’s orders, escape contempt of court charges, and still rest assured that his assets will remain protected.” Id. at 1241.

Placed alongside the findings above, the court’s closing perspective is clear:

“Given that the Andersons’ trust is operating precisely as they intended, we are not overly sympathetic to their claims and would be hesitant to overly-restrict the district court’s discretion, and thus legitimize what the Andersons have done.” Id. at 1244.

Practical implications for U.S. families

  • Repatriation and contempt remain available tools. Courts will require assets “held for [a settlor’s] benefit” outside the U.S. to be returned and will use civil contempt if orders are not obeyed. Id. at 1231–32.
  • Drafting that disables compliance at the moment of a U.S. order invites adverse inferences. Duress provisions and similar mechanics factored centrally in the court’s analysis. Id. at 1233, 1239 & n.9, 1240–41.
  • Assertions of “no control” face exacting scrutiny. Where the record suggests retained influence or practical access, courts are skeptical. Id. at 1241–42.

For families weighing offshore options or reviewing existing documents, a disciplined, case-driven risk assessment is essential before any funding occurs—particularly with appreciated assets or complex reporting obligations.

Our practice conducts confidential feasibility reviews focused on control, enforcement exposure, and tax/reporting alignment, so decision-makers can proceed—onshore or offshore—with a full understanding of the legal posture reflected in Affordable Media.

Contact Dilendorf Law Firm

Dilendorf Law Firm assists tech founders, high-net-worth individuals, and cross-border families in evaluating offshore trusts and related structures—including Cook Islands trusts.

We provide confidential, fixed-scope reviews that assess control mechanics, enforcement risk (including repatriation and contempt exposure), and U.S. tax and reporting requirements before assets are moved and legal title is reassigned to an offshore trustee.

To discuss a paid initial consultation:

Email: info@dilendorf.com | Phone: 212-457-9797 |Web: dilendorf.com

This material is for educational purposes only and does not constitute legal or tax advice.

Updated for 2026. If you are considering an offshore asset protection trust or a Domestic Asset Protection Trust in Wyoming, South Dakota, Nevada, or Alaska, contact Dilendorf Law Firm at 212.457.9797 or info@dilendorf.com to discuss a tailored structure for your assets and family.

​Offshore asset protection trusts—especially in the Cook Islands and similar jurisdictions—are often sold as near‑bulletproof shields against U.S. creditors.

Domestic asset protection trusts (DAPTs) are marketed as the safer, onshore alternative. In practice, U.S. judges look at both through the same lenses: control, intent, and timing.
​
For years, courts have ordered assets brought back, denied bankruptcy discharges, and imposed sanctions when offshore or domestic trusts were used mainly to block legitimate creditors or regulators.

Labels and jurisdictions matter less than how the structure is set up and why it was funded.
​
Dilendorf Law Firm helps clients understand these rulings and build asset protection and estate planning structures—offshore, domestic, or hybrid—that are designed for real‑world legal pressure in 2026 and beyond.​

  1. Peoples Bank of Charles Town v. Colburn

In this case, the bankruptcy court denied the debtor’s request to eliminate his debts after finding that he had hidden an interest in an offshore trust.

Charles Colburn created a trust in Bermuda called the Prince Trust and moved significant assets into it. Although he claimed he no longer had control over the assets, the court found he retained a hidden right to benefit from the trust in the future. He also held a leadership role in the trust’s protector committee and was listed in SEC filings—further proof of his ongoing involvement.

Yet he failed to list any interest in the trust on his schedules or statements. The court concluded:

“We conclude that the Debtor knew of his reversionary interest at the time he prepared his Schedules and Statement of Affairs but chose to conceal such interest.”

Courts closely examine offshore trusts—especially when a debtor still benefits from or controls the trust in some way. Hiding these interests can lead to serious consequences, including losing the right to discharge debts in bankruptcy.

  1. Marine Midland Bank v. Portnoy

In this case, the court examined whether a debtor’s offshore asset protection trust, established in Jersey (Channel Islands) and funded with nearly all of his assets, could shield those assets from creditors in bankruptcy.

“[…] Portnoy established a trust (“the offshore trust”) in St. Helier in Jersey, and executed a declaration of trust naming Jarden Morgan Trustees (Jersey) Ltd. as sole trustee (“Jarden”), as himself “Principal Beneficiary,” and his two children as additional beneficiaries. Over the course of the next several months Portnoy transferred his assets to that trust.”

Although the trust appeared valid under Jersey law, the court emphasized substance over form and found that the debtor retained de facto control over the trust. As a result, the court concluded the trust was illusory and denied Portnoy a discharge under 11 U.S.C. § 727(a)(2)(A).

  1. Riechers v. Riechers

In this matrimonial action, the husband attempted to shield marital assets by transferring them into a Cook Islands trust during divorce proceedings.

The court refused to recognize the trust’s protections, holding that it was used to hinder equitable distribution and evade marital obligations. This case exemplifies how domestic courts treat foreign trusts with skepticism when used to obstruct fair division.

“[…] this court awards to the plaintiff one half of the value of the marital assets placed in the Cook Islands trust by the defendant […] to wit: $ 2,000,000.”

  1. Sattin v. Brooks

The debtor created and funded a Cook Islands trust while owing substantial debts and immediately before filing for bankruptcy.

The court determined that the trust was established with the intent to hinder, delay, or defraud creditors, making the transfer fraudulent under § 727(a)(2).

“[…] court essentially described the trust provisions here, i.e., the trustees are to pay to the debtor-settlor all of the income and as much of the principal as is deemed advisable in their discretion.”

  1. FTC v. Affordable Media (The Anderson Case)

This case involved Michael and Denyse Anderson, who transferred proceeds from a fraudulent telemarketing scheme to a Cook Islands trust. When ordered to repatriate the assets, they claimed impossibility due to the trust’s duress clause.

“Although the Andersons assert that their ‘inability to comply with a judicial decree is a complete defense to a charge of civil contempt, regardless of whether the inability to comply is self-induced,’ […] It is readily apparent that the Andersons’ inability to comply with the district court’s repatriation order is the intended result of their own conduct – their inability to comply and the foreign trustee’s refusal to comply appears to be the precise goal of the Andersons’ trust.”

The Ninth Circuit affirmed the contempt order, finding that the Andersons retained control over the trust structure and had orchestrated the conditions preventing compliance.

  1. SEC v. Bilzerian

Bilzerian, a former corporate raider, was subject to a disgorgement order in connection with an SEC enforcement action. In an attempt to avoid this judgment, he transferred funds into offshore accounts while the court’s asset freeze order was in effect. The court held him in civil contempt for violating the order.

“[…] the Court finds that Bilzerian has not made all reasonable efforts to comply with the Orders. In fact, the Court finds he has purposefully sought to insulate his assets from the Court’s reach. Third, the Court finds that, to the extent that Bilzerian cannot comply with its Orders, it is the result of his own machinations.”

  1. In re Lawrence

In this Chapter 7 bankruptcy, Stephan Lawrence transferred substantial assets into an offshore trust prior to facing an adverse arbitration award. After the court ordered turnover of the trust assets, Lawrence invoked the trust’s duress clause and claimed compliance was impossible.

The Eleventh Circuit rejected this defense, holding that Lawrence retained de facto control over the trust through his power to appoint trustees. Because he had created the impossibility himself, the court upheld a civil contempt sanction, including incarceration until compliance.

“[…] Lawrence created this Trust in an obvious attempt to shelter his funds from an expected adverse arbitration award. In addition, at the time Lawrence became an excluded person under the Trust he retained the ability to appoint a new Trustee who would have the power to revoke the excluded person status at any time.”

  1. Bank of America v. Weese

Brian and Elizabeth Weese transferred over $20 million to a Cook Islands trust shortly after Bank of America demanded repayment of a multimillion-dollar loan.

Although the trust was designed to shield assets from creditors, the court found that the Weeses retained effective control over the trust and used its assets for personal benefit, including living in a trust-owned property rent-free.

“[…] the Weeses allegedly transferred millions of dollars into an offshore trust created pursuant to the laws of the Cook Islands in an effort to defraud the creditors.”

The court concluded that the trust arrangement did not preclude liability and found that the couple had acted in bad faith.

  1. GFL Advantage Fund v. S&T Bank

In this case, GFL sought to enforce subpoenas against a domestic bank to obtain records related to an offshore trust allegedly used to conceal assets. The court upheld GFL’s right to discovery, rejecting the bank’s arguments that the subpoenas were overbroad or burdensome.

This case illustrates that while Cook Islands trusts may be formed offshore, U.S. courts can still compel domestic entities to provide relevant financial information.

“[…] this court issued the subpoenas based, in part, on Section 5326(a), which provides:

A court of record of this Commonwealth may order a person who is domiciled or is found within this Commonwealth to give his testimony or statement or to produce documents or other things for use in a matter [*15] pending in a tribunal outside this Commonwealth.”

  1. Breitenstine v. Breitenstine

In this high-net‑worth divorce case, the husband created a Bahamas asset-protection trust shortly after separation and continued transferring marital assets into it during litigation.

The Wyoming courts found that the trust was formed and used specifically to place assets beyond the reach of both present and potential creditor claims—including those of his spouse.

“The [family] Trust was created for the sole purpose of defrauding the defendant’s creditors and potential creditors, including the plaintiff, Nancy L. Breitenstine.”

The court further noted the husband retained control over those assets despite the offshore designation. Ultimately, the court ordered asset repatriation, assignment of property under his control to the wife, and held him in contempt for continued noncompliance.

  1. FTC v. AmeriDebt

The FTC brought claims against defendant Andris Pukke for operating a deceptive nonprofit credit counseling service. The defendant transferred substantial assets to multiple offshore trusts, including one in the Cook Islands. Despite these transfers, the court found that the defendant maintained substantial control over the trusts.

“As far as the power of the Court to compel trustees to turn over trust assets to the Receiver, the Order requires Defendants […] to turn over trust assets to the Receiver. […] Andris Pukke, who appears to maintain substantial de facto control over the trusts [..].”

  1. Barbee v. Goldstein

The court reviewed whether funds transferred into offshore trusts could be recovered during a bankruptcy proceeding. The opinion illustrates judicial willingness to scrutinize asset transfers designed to hinder creditors.

Despite the foreign structure and spendthrift provision, the court noted that it was self-settled and subject to U.S. creditor reach. The judge allowed claims to proceed on alter ego, fraudulent transfer, and unjust enrichment theories, focusing on the settlor’s continued control.

“Although the JG Trust includes a spendthrift provision, it is not a spendthrift trust because it was self-settled [… ]. Florida courts do not enforce spendthrift provisions where a trust was self-settled or where the beneficiary retains control over the trust’s property.”

  1. SEC v. Solow

The SEC pursued the defendant, Solow, for failure to satisfy a prior judgment. The defendant claimed an inability to pay due to funds being placed in an offshore trust.

The court rejected this defense and granted the SEC’s motion for contempt, finding that the defendant’s conduct demonstrated a willful attempt to frustrate collection efforts.

“This Court finds that Mr. Solow was diligent in his efforts to divest himself of assets that would otherwise have been available to satisfy the Court’s disgorgement order.”

  1. Greenspan v. LADT LLC

In Greenspan v. LADT, LLC, the California Court of Appeal held that a trustee can be added as a judgment debtor under the alter ego doctrine when a trust is used to shield assets and avoid liability.

After securing an $8.45 million arbitration award against two LLCs controlled by real estate developer Barry Shy, the plaintiff sought to add Shy, his companies, and the trustee of the Shy Trust as judgment debtors. Although the trial court denied the motion—ruling that the alter ego doctrine doesn’t apply to trusts—the appellate court reversed.

The court clarified that while a trust is not a legal entity, a trustee may be held liable under the alter ego doctrine:

“Under prevailing authority, Moti Shai, as trustee of the Shy Trust, may be added as a judgment debtor to provide creditors with access to the trust’s assets.”

The decision underscores that courts may pierce formal structures, including trusts, to prevent injustice and enforce judgments.

  1. FTC v. Direct Benefits Group

the Federal Trade Commission pursued action against a deceptive telemarketing and negative option marketing scheme.

The court’s findings addressed the defendants’ financial transfers, including attempts to shield assets through trusts or layered structures.

“There is good cause to believe that immediate and irreparable damage to this Court’s ability to grant effective final relief for consumers […] will occur from the sale, transfer, or other disposition by Defendants of their Assets and company records […] unless Defendants are restrained and enjoined by Order of this Court.”

  1. United States v. Rogan

In this healthcare fraud case, the United States obtained a $64.2 million judgment against Peter Rogan, who had fled the country. To enforce the judgment, the government traced Rogan’s investment in a company called 410 Montgomery, LLC.

Although Rogan did not hold title to the underlying assets, the government sought to garnish the company’s proceeds based on Rogan’s membership interest.

The case underscores how courts distinguish between legal ownership of company assets and equity interests held by individuals. Despite Rogan’s indirect control, the court reinforced that equity holders are residual claimants and do not own the company’s property, which limits their ability to shield assets from creditors through corporate entities or similar asset-holding structures.

“Investors in corporations and LLCs own tradable shares or units; they do not own the company’s assets. The separation of investment interests from operating assets is a fundamental premise of business law.”

This case illustrates that while entities like LLCs may provide a degree of separation, courts will not permit them to frustrate legitimate enforcement of judgments — especially when the individual retains a financial interest subject to garnishment.

  1. Netsphere v. Baron

In this case, the court blocked an attempt to seize assets held in a Cook Islands trust. Jeffrey Baron was accused of trying to move money offshore to avoid paying lawyers. The trust, called the Village Trust, owned U.S. companies that held valuable domain names, and Baron was its only beneficiary.

Even though Baron’s behavior frustrated the court, the judges ruled that seizing his trust assets was not allowed: “The receivership […] encompassed all of Baron’s personal property […] none of which was sought in the […] lawsuit.”

The court made clear: U.S. judges can’t take control of foreign trust assets just because someone might owe money. There must be a valid legal claim first:

“A court may not reach a defendant’s assets unrelated to the underlying litigation […] to satisfy a potential money judgment.”

  1. Rush University v. Sessions

In this case, the Illinois Supreme Court examined whether a transfer of assets into a self-settled trust by a debtor constituted a fraudulent transfer under the Illinois Uniform Fraudulent Transfer Act (IUFTA).

The defendant, Sessions, transferred $1.5 million into a trust after incurring substantial medical debt. The court found the transfer was made with the intent to shield assets from creditors, emphasizing that such a transfer to a self-settled spendthrift trust could not defeat legitimate claims.

“A transfer made or obligation incurred by a debtor is fraudulent as to a creditor, whether the creditor’s claim arose before or after the transfer was made or the obligation was incurred, if the debtor made the transfer or incurred the obligation with actual intent to hinder, delay, or defraud any creditor of the debtor.”

This case highlights the vulnerability of self-settled trusts—even those with spendthrift provisions—when used to hinder, delay, or defraud creditors. Courts may unwind such transfers and permit creditors to reach the trust assets, especially where timing and circumstances suggest deliberate evasion.

  1. United States v. Grant

In this case, the U.S. government obtained a $36 million judgment against Arline Grant and sought to collect against assets held in two offshore trusts in Bermuda and Jersey. Despite a 2005 repatriation order requiring Grant to bring the assets back to the U.S., she failed to comply and later received over $500,000 in trust distributions, much of it routed through accounts in her children’s names.

The court ultimately held Grant in contempt and issued a permanent injunction, requiring her to (1) request trust distributions on a quarterly basis, (2) surrender all funds received from the trusts, and (3) refrain from informing trustees that her requests were compelled by court order.

“Mrs. Grant has engaged in a scheme to avoid collection of her liabilities by having trust funds directly deposited into accounts in her children’s names. […] Through this scheme, Mrs. Grant has dissipated hundreds of thousands of dollars of assets to which federal tax liens attach.”

This case highlights how U.S. courts can pierce the formality of offshore trust structures when debtors retain control or benefit from the assets and attempt to frustrate enforcement. Even when the trust is foreign, courts may compel repatriation and enjoin efforts to hide or dissipate assets under tax collection authority

  1. U.S. Bank v. Rose

In this case, the defendant transferred millions of dollars in assets to a Cook Islands trust while seeking a loan modification from U.S. Bank. The court found that Rose’s failure to disclose the trust violated the loan’s antiassignment provision and constituted a fraudulent inducement.

“We cannot conclude that the transfer of millions of dollars in assets to an offshore account in the Cook Islands would have been immaterial to US Bank’s decision to extend the Loan.”

The appellate court reversed the denial of prejudgment attachment, underscoring the materiality of hiding offshore transfers.

  1. In re Allen

After transferring $6 million into a Cook Islands trust to shield it from creditors, Daniel Allen argued the funds were beyond reach. The court disagreed, finding that fraudulent transfers are still recoverable even if the assets are offshore.

“The mere fact that Allen’s dilatory conduct has foiled ATN’s past attempts to recover actual possession of the funds does not preclude a finding that the funds are properly part of ATN’s estate […].”

  1. In re Raymond

In this bankruptcy case, the debtor attempted to shield assets by transferring funds into a trust. The court found that the debtor had transferred the funds to hinder, delay, or defraud creditors and held that the trust transfer was avoidable under both state and federal fraudulent transfer laws.

“The Trustee alleged that the Debtor paid down his debts and granted collateral security to some of his creditors, but claimed insolvency to many others, telling creditors that “[the project] had wiped out his assets and that he would not be able to pay his debts.”

The case underscores that even trust transfers that occur years before bankruptcy may be unwound if done with improper intent.

  1. BB&T v. Hamilton Greens

In this case, the court examined a series of transfers made by a judgment debtor into a trust to frustrate creditor recovery.

Although the trust itself was not a party to the suit and the complaint did not formally seek relief against it, the court acknowledged the debtor’s creation of the trust and transfer of assets into it as part of a broader fraudulent scheme.

“The money Donnelly [Impleader-Defendant] saved by having the Trust pay her legal expenses was an ill-gotten gain, or unjust enrichment. […] In addition to a judgment as to the fraudulently transferred funds in Donnelly’s possession, the Court will enter judgment against Donnelly for the amount that she was unjustly enriched (plus interest) by having her legal expenses paid with fraudulently transferred funds.”

The ruling illustrates the limitations of asset protection when trusts are used to hide or reroute assets from creditors. Courts may still reach assets in such trusts through equitable remedies like disgorgement.

  1. In re Cork

In this case, the debtor established a Cook Islands trust and transferred nearly $700,000 into it shortly before filing for bankruptcy. The court found the timing and circumstances surrounding the transfer indicative of fraudulent intent.

Despite the offshore nature of the trust, the court held the transfer avoidable under federal bankruptcy law, reinforcing that foreign trusts do not shield debtors from U.S. fraudulent transfer rules.

“The Court finds that, in the one year prior to the Petition Date and in the time after the filing of the Petition, the Debtor, with the subjective intent to hinder, delay, or defraud his creditors, transferred, removed, or concealed, or has permitted others to transfer, remove, or conceal, the Debtor’s property.”

  1. Harnack v. Fanady

The Illinois Appellate Court affirmed the trial court’s decision to hold Steve Fanady in indirect civil contempt and order his incarceration for failing to comply with a divorce judgment that awarded his former spouse, Pamela Harnack, 120,000 shares of CBOE stock. Over a decade of litigation, Fanady repeatedly resisted enforcement of this judgment by transferring assets offshore and claiming an inability to comply.

The Illinois Appellate Court rejected Fanady’s defense and affirmed the contempt finding, emphasizing that a party cannot avoid court orders by deliberately placing assets out of reach through foreign trust structures:

“Just as we previously explained that Fanady cannot ‘escape his obligations to Harnack by swindling his business partners’ to make assets unavailable, he also cannot avoid his obligations to his former spouse by structuring his assets in an offshore trust with the express goal of ‘making himself uncollectable.’”

This case illustrates how Illinois courts scrutinize and pierce offshore trust arrangements when used to frustrate court orders, particularly in domestic relations matters, and reinforces that self-induced “impossibility” will not shield parties from contempt findings.

  1. Brown v. Higashi

In Brown v. Higashi, the U.S. Bankruptcy Court for the District of Alaska pierced two Belizean self-settled trusts—Leones Company and American International Retail—holding that they were created by the debtors, S. Wayne and Carrol Brown, through fraudulent transfers to shield assets from creditors, and therefore were invalid under Alaska law.

The court found the trusts to be mere instruments of deception rather than legitimate estate planning tools: “The true substance and business of this trust is to avoid creditors and nothing more”, and ruled that their assets were property of the bankruptcy estate.

The court applied substance-over-form analysis and highlighted the futility of hiding behind foreign jurisdictions:

“Belize is a popular trust jurisdiction precisely because it allows the types of fraudulent transfers that are unenforceable in America.”

The ruling sends a clear message: offshore self-settled trusts, even those formed under protective foreign laws, will not be honored in U.S. bankruptcy proceedings if they are used to defraud creditors.

  1. FTC v. Fortuna Alliance

In FTC v. Fortuna Alliance, the Federal Trade Commission obtained a permanent injunction and $2.8 million in consumer redress against Fortuna Alliance, L.L.C. and its principals for operating an illegal pyramid scheme and making deceptive earnings claims.

The case is notable not only for its consumer protection enforcement but also for how the court dealt with asset shielding mechanisms—including foreign trusts and offshore protections—used to delay or prevent victim restitution.

The Fortuna defendants had transferred substantial assets to offshore accounts and sought protection under foreign trust structures in jurisdictions such as Belize and Antigua. These trusts, likely structured to insulate funds from U.S. enforcement, became a major point of contention in the litigation and settlement process.

The court imposed strict conditions to ensure the return of funds to defrauded consumers:

“If requests for refunds exceed this initial Redress Fund, the Fortuna Defendants shall make sufficient additional funds available […] secured with an irrevocable letter of credit […] in an amount of $2.8 million.”

  1. In re Bressman

In In re Bressman, the U.S. Court of Appeals for the Third Circuit addressed whether legal fees paid to two law firms—using funds funneled through a Cook Islands trust—could be clawed back by the bankruptcy trustee as unauthorized post-petition transfers of estate assets.

The Third Circuit assumed, for purposes of analysis, that the Cook Islands trust was in fact part of the bankruptcy estate, but it still ruled in favor of the law firms. It held that under § 550(b)(1) of the Bankruptcy Code, a trustee may not recover avoidable transfers from transferees who take in good faith, for value, and without knowledge of voidability. The court concluded that the law firms met this standard:

“Each of the law firms came forward with persuasive evidence that they knew they could not accept payment from estate assets […] and that they were unaware of any connection between the payments and estate assets.”

While the court ultimately upheld summary judgment in favor of the law firms, the case highlights the judicial treatment of foreign trust structures in bankruptcy when used to fund litigation expenses or obscure asset ownership.

  1. United States v. Plath

In United States v. Plath, the U.S. District Court for the Southern District of Florida held Robert Plath in civil contempt for failing to comply with a court order compelling him to produce documents and testify in connection with IRS summonses related to an offshore trust account.

The court found:

“The evidence indicates that Plath received a package purchased on the Leadenhall Trust account, and thus he had some knowledge of the offshore account at Leadenhall Trust. Yet, Plath failed to use any efforts to contact Leadenhall Trust to obtain the necessary documentation.”

The court rejected Plath’s claim of inability to comply and held:

“Plath has failed to meet the substantial and rigorous burden of showing that he has made ‘all reasonable efforts to comply.’”

This case illustrates how U.S. courts can compel compliance with IRS summonses even when the target attempts to hide behind foreign financial structures like offshore trusts or credit card arrangements. Although the court did not make a specific ruling on trust ownership or fraudulent transfer, it treated the offshore account as within the respondent’s control and presumed access, given the direct evidence of use.

Conclusion

Dilendorf Law Firm’s goal is to help clients understand that offshore and domestic asset protection trusts are high‑risk structures, not guaranteed shields.

Under real legal pressure—whether in the Cook Islands or in DAPT states like Wyoming, South Dakota, Nevada, and Alaska—these trusts can be challenged and, in some cases, collapse. Dilendorf Law Firm assists clients with risk reviews of existing offshore and domestic trusts.

The firm provides legal opinions on enforcement and tax exposure, and redesign strategies aimed at improving control, timing, and compliance, while making clear that no structure can guarantee absolute protection.

Contact us at (212) 457-9797 or email us at info@dilendorf.com to schedule a confidential consultation.

Many service providers, including Coinbase, T-Mobile, Verizon, and AT&T, include arbitration clauses in their user agreements. These provisions determine how disputes will be resolved and often require that they be handled through arbitration rather than in court.

Clients often ask whether these arbitration clauses are enforceable. In most circumstances, the answer is yes. Coinbase’s arbitration clause has been reviewed in several cases, and courts have consistently upheld its validity.

Aggarwal v. Coinbase, Inc.

In Aggarwal v. Coinbase, Inc., 685 F. Supp. 3d 867 (N.D. Cal. 2023), the plaintiffs challenged whether the Coinbase User Agreement — specifically its arbitration clause — applied to them.

The court noted:

“On February 4, 2022, Mr. El Bermawy logged into his Coinbase account via Coinbase Pro iOS mobile app and agreed to the updated 2022 User Agreement. (Zia Decl., Ex. 2.) Similarly, Mr. Aggarwal logged into his Coinbase account via Coinbase Pro iOS mobile app and agreed to the updated 2022 User Agreement on February 5, 2022.” Id. at 874.

The plaintiffs argued that “Coinbase’s arbitration agreement is illusory, and therefore unenforceable.” Id. at 875. The court disagreed, finding that the agreement was not unconscionable:

“The Court therefore compel[ed] arbitration.” Id. at 882.

It further granted “Coinbase’s motion to compel arbitration and [stayed] all further litigation pending completion of arbitration.” Iat 882.

Bielski v. Coinbase, Inc.

In Bielski v. Coinbase, Inc., 87 F.4th 1003 (9th Cir. 2023), Coinbase appealed a district court’s denial of its motion to compel arbitration.

The opinion begins:

“Defendant-Appellant Coinbase, an online cryptocurrency exchange, appeals the district court’s denial of its motion to compel arbitration of claims brought by Plaintiff-Appellee Abraham Bielski. Coinbase challenges the district court’s order at every step.” Id. at 1007.

Bielski argued that the agreement was unconscionable because it was an adhesion contract, lacked mutuality, and imposed one-sided, onerous pre-arbitration procedures. The Ninth Circuit rejected these arguments:

“We disagree, and therefore reverse the district court’s denial of Coinbase’s motion to compel arbitration.” Id. at 1013.

The court also rejected his “surprise” argument:

“Mr. Bielski’s argument that the pre-arbitration dispute resolution process establishes surprise [is rejected] because the process is neither hidden nor beyond the reasonable expectation of the user.” Id. at 1014.

The court concluded by reversing the denial of Coinbase’s motion to compel arbitration.

Federal Arbitration Act (FAA) Principles

These rulings reflect the strong federal policy in favor of enforcing arbitration agreements, as set out in the Federal Arbitration Act.

Under the FAA, arbitration clauses are valid and enforceable unless specific legal grounds exist for revocation.

Courts generally require that challenges focus specifically on the arbitration clause or delegation provision, not the entire contract.

Wu v. Uber Tech., Inc.

The New York Court of Appeals in Wu v. Uber Tech., Inc., 43 N.Y.3d 288 (2024), reinforced this principle, noting New York’s “long and strong public policy favoring arbitration.” Id. at 297.

The court stated:

“New York courts interfere as little as possible with the freedom of consenting parties to submit disputes to arbitration.” Id. at 297.

It further recognized that:

“In this case, the parties agree that the arbitration agreement in Uber’s January 2021 terms of use is governed by the Federal Arbitration Act (FAA) (9 USC § 1 et seq.).” Id. at 297.

And importantly:

“Importantly, under both the FAA and New York law, parties may agree to have an arbitrator decide not only the merits of a dispute, but also ‘”gateway” questions of “arbitrability,”’ such as whether their agreement to arbitrate covers a particular controversy or whether one party should be relieved from the agreement due to the wrongful conduct of another party.” Id. at 301.

In its conclusion, the court explained:

“Here, the consequence of plaintiff’s purported failure to carefully review Uber’s updated terms of use is that she must make her arguments regarding Uber’s allegedly deceptive and unconscionable conduct to a neutral arbitrator, not the courts.” Id. at 310.

Coinbase, Inc. v. Suski

In Coinbase, Inc. v. Suski, 602 U.S. 143 (2024), the U.S. Supreme Court addressed a situation where two contracts created conflicting provisions about who decides arbitrability.

The Court summarized:

“What happens if parties have multiple agreements that evidence a conflict over the answer to the third-order question of who decides arbitrability? … Homing in on the conflict between the delegation clause in the first contract and the forum selection clause in the second, the question becomes whether the parties agreed to send the given dispute to arbitration. And that question must be answered by a court.” Id. at 143–144.

It held:

“In cases where parties have agreed to only one contract, and that contract contains an arbitration clause with a delegation provision, then, absent a successful challenge to the delegation provision, courts must send all arbitrability disputes to arbitration. But, where, as here, parties have agreed to two contracts—one sending arbitrability disputes to arbitration, and the other … sending arbitrability disputes to the courts—a court must decide which contract governs.” Id. at 152.

Key Takeaway

Most arbitration clauses, including Coinbase’s, are enforceable under federal and state law. Exceptions exist, but they are limited. Understanding the scope of an arbitration clause — and any related delegation provision — before a dispute arises can help avoid procedural surprises later.

Contact Dilendorf Law Firm

If your cryptocurrency was stolen from the Coinbase exchange, or if you are a victim of a SIM swap attack that resulted in the theft of crypto from a U.S. exchange or a decentralized wallet such as MetaMask, contact Dilendorf Law Firm.

Our firm has over six years of experience in arbitrating these cases in all major arbitration forums, including AAA, JAMS, and NAM. We have handled over 100 arbitration cases, some of which we have taken to evidentiary hearings and won.

Email: info@dilendorf.com | Phone: 212.457.9797

If your crypto was stolen through a SIM-swap attack, time is critical. Hackers can use a compromised phone number to bypass two-factor authentication, gain access to your crypto exchange accounts or decentralized wallets like MetaMask, and drain your assets within minutes.

Max Dilendorf is a leading attorney for victims of crypto theft involving SIM-swap attacks, exchange account takeovers, and unauthorized wallet access. Based in New York and representing clients nationwide, Max has over six years of experience handling consumer arbitrations against major U.S. crypto exchanges—including Coinbase, Kraken, and Binance—as well as phone carriers such as Verizon, T-Mobile, and AT&T.

He has represented victims in more than 100 cases, including claims involving stolen funds from decentralized wallets. Many of these cases have gone to final evidentiary hearings before AAA, JAMS, and NAM. If you’ve lost crypto due to a SIM swap, this guide outlines 15 immediate steps you can take to protect your rights and begin the process of recovery.

  1. Secure Your Mobile and Devices

Immediately contact your mobile carrier to report the SIM swap. Request that your account be locked and any unauthorized changes be reversed.

At the same time, update your passwords on your mobile devices, crypto exchange, email, and any other sensitive accounts. Make sure to enable two-factor authentication and take screenshots of your new security settings for your records.

  1. Notify Your Crypto Exchange

As soon as you suspect a breach, call your crypto exchange’s support or fraud department. Explain that your SIM has been swapped and that unauthorized transactions have taken place.

Ask them to freeze your account to prevent further losses, and provide any details you have, such as transaction times and amounts.

In addition to calling support, submit a detailed support ticket to formally document the issue. For example, if you’re a Coinbase user, file a support ticket at Coinbase Support.

Similarly, if you use Gemini, submit a ticket at Gemini Support Request. Include all relevant details and evidence to help expedite their investigation and account freezing process.

  1. Collect and Preserve Evidence

Gather all available evidence related to the incident. Save emails, bank statements, and transaction logs.

Capture screenshots of suspicious activity, error messages, and any alerts you received from the crypto exchange or your mobile carrier. This documentation will be critical for any dispute or legal proceedings.

  1. File a Police Report

Contact your local law enforcement immediately to file a police report. Provide them with all the details and evidence you have collected.

Make sure to obtain a copy or photo of the report, as it will support your case when dealing with your exchange or insurance providers.

  1. Submit a Complaint to the FBI

File a report with the FBI’s Internet Crime Complaint Center (IC3). Although this may not lead to immediate action, an official FBI report strengthens your claim and helps build a record of the incident for future recovery efforts.

  1. Place a Fraud Alert on Your Credit

Even though this case involves crypto, it’s wise to protect your overall financial identity. Contact the major credit bureaus to place a fraud alert or freeze on your credit.

Retain any confirmation messages or screenshots as proof that you have taken this step.

  1. Contact Regulatory Authorities

If your crypto exchange or mobile carrier does not adequately address the breach, consider filing a complaint with regulatory agencies such as the Consumer Financial Protection Bureau (CFPB) or your state’s financial regulatory authority. Their involvement may add additional pressure on the institution to act.

  1. Your Rights Under the Federal Communications Act

Under the FCA, you have the right to have your communications and personal data protected. Carriers must implement strict security measures and respond promptly to any unauthorized access or SIM swap incidents.

If you believe your carrier has not met these standards, you have the right to file a complaint with the Federal Communications Commission (FCC) to seek further investigation and enforcement.

  1. Follow Your Carrier’s Pre-Arbitration Procedures

Before you can initiate arbitration regarding the SIM swap, carefully review the pre-arbitration procedures outlined in your phone carrier’s terms and conditions.

Most carriers require you to submit a formal notice of dispute and observe a 60-day notice period before arbitration can begin.

For detailed instructions, refer to your carrier’s terms and conditions:
• Verizon Wireless: Verizon Wireless Terms and Conditions
• AT&T Mobility: AT&T Mobility Terms and Conditions
• T-Mobile USA: T-Mobile USA Terms and Conditions

  1. Provide Formal Notice to the Exchange

If your crypto exchange is responsible for transferring your funds to unauthorized individuals during an account takeover, you must submit a formal notice as required by your user agreement.

For example, Coinbase requires a 45-business-day notice before filing an arbitration claim, while Gemini requires a 60-day notice. It’s essential to meet these deadlines to protect your rights.

  1. Seek Professional Legal Advice

Phone carriers often include waivers and limitations of liability in their agreements, which can limit your ability to recover damages. Having an experienced attorney on your side is crucial.

An experienced lawyer will explain your rights, help you navigate the dispute and arbitration process, and make sure you don’t fall victim to hidden contractual traps. Their expert guidance can be the key to building a strong case and protecting your interests.

  1. Consider a Blockchain Forensics Expert

If your case involves large amounts or complex transactions, consider hiring a blockchain forensics expert. They can trace the movement of your stolen funds on the blockchain and provide a detailed report to support your claim in legal or arbitration proceedings.

  1. Prepare Your Arbitration Demand

If your dispute with your phone carrier moves to arbitration, review the carrier’s dispute resolution procedures outlined in your terms and conditions carefully. Gather all your evidence and file your arbitration demand as required by their guidelines.

The arbitration will be handled by a designated forum, such as AAA, NAM, or JAMS, as specified in your terms and conditions.

Expect the arbitration process to take between 9 to 12 months, during which you may face depositions, expert witness testimony, discovery motions, and a final evidentiary hearing that could last up to five days. Most arbitration hearings are held online, with all parties participating remotely. Update your demand as necessary if new evidence emerges.

  1. Select a Qualified Arbitrator

When your case moves to arbitration, choose an arbitrator who understands the complexities of SIM swap fraud and crypto theft. Look for someone with experience in digital security and telecommunications disputes.

A knowledgeable arbitrator will understand the technical aspects of your case and help ensure a fair evaluation.

  1. Understand Arbitration’s Finality and Confidentiality

Keep in mind that arbitration decisions are final and generally cannot be appealed, except in rare instances such as proven arbitrator bias. Additionally, arbitration is confidential, meaning the details and outcomes are not made public.

This confidentiality may limit your ability to reference similar cases in the future, so be sure you understand its implications before proceeding.

Contact Us

If you need help with your SIM swap or crypto theft case, don’t hesitate to reach out to Dilendorf Law Firm. Contact us today at (212) 457-9797 or email info@dilendorf.com to explore your legal options.

Resources:

  1. Cryptocurrency – Internet Crime Complaint Center (IC3)
  2. NYDF Consumer Complaint
  3. AAA Consumer Arbitration Rules
  4. JAMS Comprehensive Arbitration Rules & Procedures
  5. Crypto Enforcement
  6. Modern Scams: How Scammers are Using Artificial Intelligence and How We Can Fight Back
  7. Cryptocurrency Fraud Report 2023
  8. Cryptocurrency: Selected Policy Issues
  9. Combatting Illicit Activity Utilizing Financial Technologies and Cryptocurrencies
  10. Crypto-Assets: Implications for Consumers, Investors, and Businesses
  11. Exploring the Cryptocurrency and Blockchain Ecosystem
  12. Crypto Assets
  13. What To Know About Cryptocurrency and Scams
  14. Digital Assets | CFTC
  15. Taxpayers need to report crypto, other digital asset transactions on their tax return

We stay up to date and track cases involving phishing attacks and sim swap affecting major cryptocurrency exchanges and mobile operators:

One of the largest cellphone carriers in the United States is facing yet another lawsuit by a digital currency investor over SIM swap fraud. T-Mobile failed in its duty to protect its users and resulted in the plaintiff’s loss of $55,000 worth of BTC, according to the lawsuit filed in Pennsylvania.

I am victim of a SIM Swap scam. Both T-Mobil and Coinbase.com where negligent and failed to protect me. I have all the evidence to prove my case.

An 84-year-old grandmother living in West Palm Beach started investing in cryptocurrency to help save up for her family’s future. Then, nearly all of the money she put into cryptocurrency vanished after she claims a hacker got into her accounts and drained it of about $800,000.

Coinbase users have filed 134 pages of complaints to the SEC alleging that their funds have been “stolen” by the exchange

Yesterday, Kevin Frye filed a complaint in the Southern District of Florida against T-Mobile USA, Inc. for allegedly conducting a “SIM-Swap” without his consent, resulting in the loss of tens of thousands of dollars worth of cryptocurrency. The plaintiff claimed that “T-Mobile Representatives were either complicit with the theft or grossly negligent” since they have been on “notice for years that their security measures were not adequate.”

A Pennsylvania woman who lost the equivalent of $20,000 in cryptocurrency as part of a mobile fraud scheme says T-Mobile failed to protect her account in the face of a wave of similar incidents.

Nine months before scammers stole $20,000 from Kesler’s Coinbase account, the suit argues, Jack Dorsey was the victim of another high profile SIM swap, in which outsiders seized control of the Twitter CEO’s information. Security journalist Brian Krebs also covered the issue in 2018, specifically reporting that a T-Mobile retail store employee was under investigation for making an unauthorized SIM swa

A man is suing Gemini, claiming it was negligent not to notice significant sums of money moved from his money market account to buy cryptocurrency on the exchange over seven days. While the trader was out of reach in the Australian outback, someone allegedly stole money from his CIT account and wired it to Gemini to purchase crypto. Later, he noticed fraudulent activity on his accounts with other banks, and is suing CIT in addition to Gemini, claiming it violated the Electronic Funds Transfer A

Hackers stole $21 million in Bitcoin and $15 million in Ethereum from retirement accounts held with IRA Financial Trust on February 8, according to a report from Bloomberg based on an anonymous source.

Interviews and thousands of complaints have revealed a pattern of account hacks where users have reported money vanishing from their accounts, reports CNBC. Once criminals gain access to an account, funds can be drained within minutes.

My account that my mom and I use together got hacked in June of this year. We lost $350,000.The hacker not only transferred out all of the crypto we owned, they used the bank accounts that were linked to purchase more. When we found out about the hack, we called our banks to stop the transfer of money. We also immediately contacted Coinbase to report the hack. However, Coinbase still let the purchase go through while the bank transactions were pending. Now, Coinbass is claiming that because we stopped our banks from transferring the money, we owe them $10,000 to reimburse them for the purchase.

California-headquartered crypto trading platform Coinbase—has been named in at least 115 complaints sent to the U.S. Securities and Exchange Commission and the California Department of Business Oversight

“I believe Coinbase has engaged in fraud by knowingly marketing a service it knows it cannot actually provide,” the filing from November last year read, adding: “Coinbase knows it does not have the infrastructure to timely and adequately meet customer needs.” At the time, bitcoin and other virtual currencies were rocketing in value, leading to an unprecedented interest from eager new investors.

It took only two minutes for the attacker to clean Sean Everett out of what was then a few thousand dollars’ worth of digital coins from his Coinbase wallet

Author Jeff Roberts said $250,000 was stolen from Coinbase in 2013/2014. Roberts claims Coinbase’s hot wallet was hacked just a year after the company’s inception in 2012, and that the hacker made away with $250,000 worth of Bitcoin

Olympia and Steve Kallman of Parma said they are dealing with some sleepless nights after police reported they had more than $22,000 taken by con artists from their Coinbase cryptocurrency virtual wallet back on Aug. 16.

T-Mobile is facing a multi-million dollar lawsuit after hackers were able to gain unauthorized access to a client’s account. Using information provided by the cellular company, hackers successfully bypassed their two-factor authentication security measures enabling them to obtain a SIM card with the client’s personal and financial information. $8.7 million in cryptocurrency was ultimately transferred out of the customer’s account.

T-Mobile has been hit with a multi-million-dollar lawsuit after Reginald Middleton lost millions of dollars when hackers gained unauthorized access to his account. The hackers used information supplied by T-Mobile to successfully circumvent the two-factor authentication measure, which allowed them to obtain a SIM card containing all of Middleton’s financial and personal information. Ultimately, $8.7 million in cryptocurrency was transferred out of Middleton’s account.

Richard Harris, the customer and plaintiff, is alleging T-Mobile’s misconduct including its failure to adequately protect customer information, hire appropriate support staff and its violation of federal and state laws led to his loss of 1.63 bitcoin.

Last night while I was sleeping my account was logged into (web) from Russia…

The Vidovics lost nearly $170,000 in the blink of an eye when someone hacked their Coinbase account.

John said his accounts with Coinbase and Coinbase Pro were emptied as he watched his phone screen.

….an increasing number of users of the currently highly popular cryptocurrency exchange called Coinbase have suddenly found their accounts on the platform empty. This is after hackers have managed to gain access to them and thoroughly drain their cryptocurrency wallets.

League of Legends superstar has had $200,000 in cryptocurrency stolen from them – directly from their Coinbase account

…an unauthorized user had changed Ms. Maguian’a passwords for trading platforms… Coinbase and initiated transactions that emptied her accounts of crypto valued at around $80,000 at the time

The Eleventh Circuit Court of Appeals ruled today that the class action against Coinbase…will be held in open court. The case in question alleges that Coinbase assisted in laundering around $8.2 mln of stolen Bitcoin (BTC) – valued at over $100 mln today.

The Vidovics lost nearly $170,000 in the blink of an eye when someone hacked their Coinbase account.

Dr. Anders Apgar, a Coinbase customer, said his account had a balance of more than $100,000 in crypto when it was hacked during a robocall.

I had $14,000+ USD in my coinbase pro account. The account was hacked at the money was switched over to crypto and sent to multiple people this occured several hours ago (05/14/2021). Case # 06082303

Tampa resident David Bryant knew something was wrong last October when he found Coinbase notifications deleted from his account and his login no longer worked. “I lost about $15,000 dollars worth of crypto,” David said.

A Texas man is suing Coinbase, the cryptocurrency trading platform. The man alleges his Coinbase account was breached to make a $50,000 unauthorized transaction. He says at least 1,000 other Coinbase accounts have also been breached.

A new report finds that Russia was linked to the majority of crypto ransomware invasions, siphoning the equivalent of $400 million in stolen funds to illicit addresses in that country. It appears Russia has strong ties to the majority of crypto hacks and cybercrimes, especially when you consider that 74% of ransomware revenue in 2021 — over $400 million worth of  cyptocurrency — went to accounts affiliated with the country in some way, according to a new report from cryptocurrency tracking and analytics firm, Chainalysis.

Case #05530638, #05542432. This all happened 4/15/21-4/16/21. How can I talk with someone from coinbase? I am so frustrated that someone stole my Bitcoin, ETH, and transferred $500 from my bank account and stole that too from my coinbase… Total almost $12,000. I am trying to understand what is going on and now I am completely blocked out of coinbase. I want answers!

An increasing number of users of the highly popular cryptocurrency exchange Coinbase have found their accounts on the platform empty after hackers managed to gain access to them and drain their cryptocurrency wallets.

Raza says Coinbase, the cryptocurrency exchange where he was robbed, has not been able to provide a solution and he thinks they need to step up security protocols.

 In four minutes, cyber looters pilfered $34,123 worth of virtual currency from a Virginia resident’s Coinbase (COIN) account, the 38-year-old told Yahoo Finance.

I received several txts last night sending me a 2fa code. I woke up and my bitcoin was transferred at 230am to some address. Any idea what happened? Was it my cell phone provider? Seems fishy to me since I could not detect any threats my phone. No idea how the culprit read my txt messages but oh well.

I am an active user of CoinBase and somehow my account was breached even with 2FA enabled. The hackers stole all of the coins in my account by converting them to BTC and sending them to their wallet. They then deposited $1k USD and purchased BTC using my debit card and stole it before I could lock my account down.

Taking my case to reddit. My account was hacked approximately 3 weeks ago and .50 BTC (approximately $23k USD) was stolen from my account. In summary, I decided to log into my account one day to check in on the balance. A hacker had locked my account out.

…hackers managed to get into the accounts and move funds off the platform, draining some accounts dry. Thousands of customers had already begun to complain to Coinbase that funds had vanished from their accounts…Coinbase did not disclose how much cryptocurrency was stolen in the attack.

CNBC interviewed Coinbase users across the country. The interviews and complaints revealed a pattern of account takeovers, where users see money suddenly vanish from their account, followed by poor customer service from the company. Since 2016, Coinbase users have filed more than 11,000 complaints against Coinbase with the Federal Trade Commission and Consumer Financial Protection Bureau, mostly related to customer service.

An increasing number of users of the highly popular cryptocurrency exchange Coinbase have found their accounts on the platform empty after hackers managed to gain access to them and drain their cryptocurrency wallets.

Loads of scams out there. Remember Coinbase does not support chat. You will never speak with a Coinbase employee.

I have been trying to contact Coinbase support since Thursday when I saw $25k BTC sold from my wallet without my consent and could not receive any assistance at all from Coinbase to protect my investment.

It was 10.6 bitcoins held in the wallet service Coinbase, the most well-funded and widely implemented service on the market.

All your money is gone. Whoops! Sorry for your loss. Some Coinbase account holders are losing their shit today as they look to their bank statements to find that the exchange has withdrawn excessive amounts of money from their accounts.

California-headquartered crypto trading platform Coinbase—has been named in at least 115 complaints sent to the U.S. Securities and Exchange Commission and the California Department of Business Oversight

“I believe Coinbase has engaged in fraud by knowingly marketing a service it knows it cannot actually provide,” the filing from November last year read, adding: “Coinbase knows it does not have the infrastructure to timely and adequately meet customer needs.” At the time, bitcoin and other virtual currencies were rocketing in value, leading to an unprecedented interest from eager new investors

Yesterday, Kevin Frye filed a complaint in the Southern District of Florida against T-Mobile USA, Inc. for allegedly conducting a “SIM-Swap” without his consent, resulting in the loss of tens of thousands of dollars worth of cryptocurrency. The plaintiff claimed that “T-Mobile Representatives were either complicit with the theft or grossly negligent” since they have been on “notice for years that their security measures were not adequate.”

A Pennsylvania woman who lost the equivalent of $20,000 in cryptocurrency as part of a mobile fraud scheme says T-Mobile failed to protect her account in the face of a wave of similar incidents.

Nine months before scammers stole $20,000 from Kesler’s Coinbase account, the suit argues, Jack Dorsey was the victim of another high profile SIM swap, in which outsiders seized control of the Twitter CEO’s information. Security journalist Brian Krebs also covered the issue in 2018, specifically reporting that a T-Mobile retail store employee was under investigation for making an unauthorized SIM swap.

Mr. Harris sued T-Mobile in July, alleging the company’s practices didn’t meet federal standards and allowed a hacker to take over his phone number in 2020 and steal bitcoin worth nearly $15,000 at the time, and more now.

T-Mobile declined to comment on the suit but motioned to move the case to arbitration. Like Verizon and AT&T, the company requires arbitration to resolve disputes in its terms of service, often leading to closed-door settlements.

Hackers stole the personal identification data for millions of past, present and prospective T-Mobile customers, leading to a huge class-action lawsuit.

Losing cellphone service is inconvenient. But in some cases, it also might mean you’re getting hacked.

“It’s a whole new wave of crime,” said Erin West, the deputy district attorney of Santa Clara County. “It’s a new way of stealing of money: They target people that they believe to have cryptocurrency,” she told CNBC.

Just when you think the massive T-Mobile hack can’t get any worse, on Friday the carrier announced that over 50 million people, including current and former customers as well as prepaid customers, were affected by the breach. Information like Social Security numbers, driver’s licenses and account PINs were exposed.

Cellphone carrier T-Mobile is being sued over allegations it failed to safeguard against a SIM swap scam that cost one customer $55,000 in lost.

The CEO of a crypto firm that recently settled with the SEC over its 2017 ICO is suing T-Mobile over a series of SIM-swaps that resulted in the loss of $8.7 million worth of crypto.

The suit accuses T-Mobile of having “abjectly failed” in its responsibility to protect the personal and financial information of its customers.

A victim of a crypto theft using SIM-swap attack has filed a lawsuit against T-Mobile, alleging the failure and negligence on the part of the US cell phone carrier in preventing these scams.

“This action arises out of T-Mobile’s systemic and repeated failures to protect and safeguard its customers’ highly sensitive personal and financial information against common, widely reported, and foreseeable attempts to illegally obtain such information,” the lawsuit alleged.

T-Mobile is currently facing a complaint against one of the victims of SIM swapping, a type of fraud.

Cheng believed that the attack would not have happened if not for “T-Mobile‘s negligent practices and its repeated failure to adhere to federal and state law.”

T-Mobile is facing yet another SIM swapping complaint involving cryptocurrency theft. Last week, a Philadelphia man named Richard Harris filed a complaint in the Eastern District of Pennsylvania against the wireless giant alleging he lost approximately $55,000 worth of Bitcoin due to the company’s failure to safeguard his account

The sim was successfully swapped which means that either it was done without the pin or the person knew the pin. Again, this is only possible if it was a T-Mobile employee and most likely one of the employees that help a month prior during the line add and upgrade.

When it comes to security or whatever it is leave T-Mobile. It is insider job someone is doing sim swaps.

T-Mobile confirmed this week that it was hit by a “highly sophisticated cyberattack” that exposed names, dates of birth, Social Security numbers and driver’s license information for more than 40 million consumers who had applied for credit with T-Mobile.

After a crazy week where T-Mobile handed over my phone number to a hacker twice, I now have my T-Mobile, Google, and Twitter accounts back under my control. However, the weak link in this situation remains and I’m wary of what could happen in the future.

American telecommunications provider T-Mobile has disclosed a data breach after an unknown number of customers were apparently affected by SIM swap attacks. SIM swap fraud (or SIM hijacking) allows scammers to take control of targets’ phone numbers after porting them using social engineering or after bribing mobile operator employees to a SIM controlled by the fraudsters.

Yesterday, someone went into a T-Mobile retail store used a fake California Drivers License to buy a copy of my SIM card.

And now for the crazy chain of events, where T-mobile allowed a complete stranger to do a SIM swap on me, and Coinbase allowed a complete stranger to change my Coinbase identity with no questions asked.

Silver Miller said that “with little more than a persuasive plea for assistance, a willing telecommunications carrier representative, and an electronic impersonation of the victim,” criminals can manage to steal millions of dollars targeting unsuspecting victims.

Hackers swapped my T-Mobile SIM card without my approval and methodically shut down access to most of my accounts and began reaching out to my Facebook friends asking to borrow crypto.

Coinbase has admitted that hackers stole crypto from thousands of its users’ accounts over a three-month period.

Bad actors were able to infiltrate the accounts of and steal cryptocurrency from around 6,000 Coinbase customers by exploiting a multi-factor authentication flaw.

Matthew doesn’t know how the hackers were able to access his Coinbase account, but he remembered that when he signed up with Coinbase, they advertised they had insurance.

My binance account was hacked a day before. All my funds were converted into ETC and withdrawn from binance. I received no confirmation mail for withdrawals too. All security steps – login password, 2FA, confirmation mail were compromised.

I don’t know how people can do this? I used strong password and also use all security option but no result this bloody f**king person got access my account.

The world’s crypto market turned red as rumours about Binance, the world’s most traded cryptocurrencies exchange, being hacked began circulating on the web yesterday morning. Some users reported that their alts on Binance were “market sold” at a loss and balances drained.

Yesterday, BeanThe5th made a thread in the popular /r/cryptocurrency subreddit, regarding a theft that has occurred on his or her Binance account. Many users who saw this Reddit thread were quite surprised, as it has become common knowledge that Binance is one of the most reputable and secure exchanges that exist.

Hackers have stolen $570 million from a blockchain linked with Binance. The largest crypto exchange has had to temporarily halt the operation of its Binance Smart Chain after the exploit.1 Since the hack, Binance Coin’s (BNB) price has also dropped noticeably, with the token down 3.5% in the last 24 hours. At the time of writing, it is trading at $281.

Hackers just stole $40 million worth of bitcoin from Binance, one of the largest cryptocurrency exchanges in the world. It’s hardly the first time crypto has been targeted by thieves. For a technology that’s supposed to be hyper secure, in practice, it’s often proven itself to be, well, not.

Binance, the world’s biggest cryptocurrency exchange, is investigating a hacking incident that affected a number of crypto tokens Friday. According to its founder and CEO Changpeng Zhao, a private key, used to encrypt or decrypt data, had been hacked.

“Initial analysis is developer private key was hacked, and the hacker updated the smart contract to a more malicious one,” Zhao said on Twitter, adding that the Ankr and Hay tokens were affected.

On Tuesday, May 7, Binance, the world’s largest cryptocurrency exchange, announced that malicious actors had compromised user application programming interface (API) keys and two-factor authentication (2FA) codes, enabling them to access the company’s hot wallet and steal more than 7,000 bitcoin (BTC).

Cryptocurrency exchange Binance temporarily suspended its blockchain network after hackers made off with around $570 million worth of its BNB token.

Hello, I have been impersonated and sim swapped, they hacked my emails, twitter, facebook, exchanges, literally everything including binance, which they stole 2 btc (daily limit) from today and will steal more if the account isn’t frozen by tomorrow. They logged in and somehow disabled my google authenticator and I cannot get into my account, microsoft is working on giving me the hacked email back that is related to binance but they say it will take 3 days to escalate the ticket. In 3 days the hackers will have already taken my entire balance so I really need the binance account frozen now before they can steal more.

My account was compromised with multiple security layers on it. Google 2FA and Email Authentication which i both had on it. My google 2FA was on a device only for my google authentication apps, I take necessary steps to prevent hacks & The crazy thing is i always receive emails when anything is changing or so on so when the hack was happening binance did not not alert my email or anything. All my securities was reset and email was changed.

Someone made a withdrawal on my Binance account when I was sleeping last night and took all my money away. My Binance account had 2FA on and everything was safe and secure but somehow the hacker managed to hack it and withdrew all my holdings out. Binance support does not have a hacked feature, so it’s pissing me off. Is there anyway that I can get it back? This is all my life savings.

Crypto exchange Gemini Trust Co. lacked proper safeguards that resulted in retirement-account holders losing around $36 million in Bitcoin and Ether when the master key got hacked, IRA Financial Trust said in a new lawsuit.

Then, on Tuesday of this this week, someone posted the entire stolen database for free on Breach Forums. It’s unclear whether this individual previously attempted to sell the database but was unsuccessful, covertly purchased it, or otherwise obtained it through some other means. We also still don’t know when the data breach occurred, though the second post attempting to sell the database claimed it was obtained in September.

Regardless, the personal information of Gemini’s 5.7 million customers is now publicly available online.

San Francisco resident Robert Ross, a father of two, noticed his phone suddenly lose its signal on Oct. 26. Confused, he went to a nearby Apple store and later contacted his service provider, AT&T. But he wasn’t quick enough to stop a hacker from draining $500,000 from two separate accounts he had at Coinbase and Gemini, according to Santa Clara officials.

My account on Gemini was hacked. My password and email address on Gemini were both changed. I have been trading on Gemini for 4 years. Gemini now claims that there is no account at Gemini with my email. I have a ton of USD in my Gemini account and they will not even confirm that the funds are frozen.

Considering a Cook Islands Trust? Know the Legal Risks First

Offshore jurisdictions are often associated with tax havens, and perceived as remote, inaccessible, and beyond the reach of U.S. courts. But are they really as invulnerable as they are often portrayed?

The so-called “Old and Cold” Cook Islands trusts, when properly established and structured, can offer long-term asset protection. However, without careful planning, the trusts may fail to achieve their intended protective purpose.

Cook Islands trusts have been a recurring subject in bankruptcy cases, often involving allegations of fraudulent transfers, asset protection strategies, and disputes over the control and repatriation of trust assets.

The following cases demonstrate various aspects of courts’ scrutiny and their efforts to balance creditor protection with the prevention of debtor misconduct.

In re Lawrence: The timing and structure of the trust suggested an attempt to frustrate creditor claims

The case of In re Lawrence, 279 F.3d 1294 (11th Cir. 2002) constitutes an important ruling on the limitations of foreign asset protection trusts as shields against U.S. bankruptcy court orders. This case firmly establishes that a debtor cannot evade judicial authority simply by transferring assets into a foreign self-settled trust.

In this matter, Mark Lawrence attempted to circumvent a $20 million arbitration award against him by transferring more than $7 million into a Cook Islands trust prior to initiating bankruptcy proceedings. The timing and structure of the trust suggested an anticipatory attempt to frustrate creditor claims.

The court noted that the trust had been structured in anticipation of creditor claims and that Lawrence retained influence—particularly through his ability to remove and replace protectors. The Court of Appeals agreed with the bankruptcy court’s finding that Lawrence had created the trust as “an obvious attempt to shelter his funds from an expected adverse arbitration award,” and retained the ability to influence the trust’s administration:

[A]t the time Lawrence became an excluded person under the trust he retained the ability to appoint a new Trustee who would have the power to revoke the excluded person status at any time. (Lawrence v Goldberg (In re Lawrence), 279 F3d 1294, 1300 [11th Cir 2002])

The Court of Appeals affirmed the bankruptcy court’s finding of civil contempt against Lawrence for his failure to repatriate the assets.

The Eleventh Circuit’s decision highlights the principle that a debtor cannot evade compliance with court orders by relying on the structure of foreign asset protection trusts, especially when the debtor retains significant control over the trust.

In re Cork: The bankruptcy court examined the timing of the transfers, the lack of consideration in return for $3.1 million transfer, and Cork’s continued control and benefit from the trust

Cork v. Gun Bo, LLC (In re Cork), 566 B.R. 237 (D. Ariz. 2017), illustrates how U.S. courts analyze transfers to offshore trusts under fraudulent transfer law and discharge denial provisions of the Bankruptcy Code (11 U.S.C.S. § 727(a)(2)).

“During state court litigation, […] Cork and his wife transferred $3.1 million to a Swiss bank account held by a Cook Islands trust […] controlled by Cork. The state court found that the transfers were fraudulent and made “in order to secret funds from” [creditors]” (In re Cork, 566 B.R. at 247).

The court concluded the transfers were made with actual “intent to hinder, delay or defraud” and denied Cork a discharge under §727(a)(2). This case emphasized that using foreign trusts does not shield debtors from traditional fraudulent transfer analysis and that courts can issue turnover orders and contempt sanctions even when assets are abroad.

SEC v. Solow: The principle of “Prior Access Equals Present Control” was applied, holding that even indirect or retained control over trust assets can subject those assets to creditor claims

In SEC v. Solow, 682 F. Supp. 2d 1312 (S.D. Fla. 2010), Solow attempted to shield assets from a securities fraud judgment by placing them in a Cook Islands trust. He argued that he had no control over the trust, saying he “[didn’t] have a dollar to [his] name,” and could not comply with the court’s disgorgement order.

Despite these claims, the court found: “that Mr. Solow rendered himself unable to pay the Final Judgment by shifting assets to his wife and by abdicating all financial responsibility to her” (Id. at 1323)

The court also established that Solow had used trust assets to pay taxes and personal expenses, which undermined his credibility. Relying on Affordable Media and Lawrence, the court held that any past access to trust assets can establish control and rejected his impossibility defense: “Mr. Solow’s inability defense is unavailing because such inability was self-created.” (Id. at 1330).

The key point: The court stated, The Eleventh Circuit adheres to the “time-tested adage: if it walks like a duck, quacks like a duck, and looks like a duck, then it’s a duck.” Mr. Solow still lives a luxurious lifestyle, enjoying the benefits of the money he has made over the years, yet he refuses to repay the victims of his fraud. Such a situation cannot stand. (Id. at 1334).

This illustrates that a debtor who has ever benefited from a Cook Islands trust will face an uphill battle in proving lack of control, especially if distributions were made with the debtor’s knowledge or participation.

In re Allen: The Florida Bankruptcy Court concluded that the defendants acted in bad faith, granted preliminary injunctive relief, and ordered the repatriation of funds

Allen received over $6 million from Advanced Telecommunication Network. When the company later obtained a court ruling declaring the transaction fraudulent and ordering the funds returned, Allen attempted to shield the money by transferring it to an offshore trust and filing for bankruptcy.

Despite Allen’s bankruptcy filing, the court made it clear: U.S. courts will look past offshore structures when enforcing judgments — especially when those structures are used to conceal assets following a fraudulent transfer.

The court granted preliminary injunctive relief and ordered that the funds be repatriated. When the Allens failed to comply with the court order, the Florida Bankruptcy Court twice held Daniel Allen in contempt of court. (In re Allen, 768 F3d 274, 277 [3d Cir 2014])

The court emphasized that substance controls over form: if the debtor effectively maintains control over the trust’s assets, the protections provided by the foreign trust structure will be disregarded, and the assets may be reached to satisfy creditor claims.

Netsphere v. Baron: The court emphasized that control over assets—not just formal title—determines whether a transfer can be set aside as fraudulent.

In Netsphere, Inc. v. Baron, 703 F.3d 296 (5th Cir. 2012), the Fifth Circuit Court of Appeals affirmed U.S. jurisdiction over assets transferred by the debtor to a Cook Islands trust. While not a direct challenge to the trust itself, the court’s willingness to disregard formal offshore protections in favor of equitable remedies reflects the same enforcement approach seen in other Cook Islands trust cases.

The court confirmed that Baron attempted to move U.S.-based assets to a foreign trust, of which he was the sole beneficiary, and ordered the repatriation of funds to secure his obligations:

Baron planned to move assets that were at the time subject to jurisdiction in the United States to a trust in a foreign country […] and Baron is the trust’s sole beneficiary. […] [T]he assets being transferred out of the United States would have been the principal source of payment for his allegedly unpaid attorney fees. […] [T]he bankruptcy court ordered Baron to request from the trust that $330,000 be deposited with the bankruptcy trustee as security, to be held until further court order. The money was deposited and held “to pay [Baron’s] obligations.” (Netsphere, Inc. v Baron, 703 F3d 296, 303 [5th Cir 2012])

This case reinforces that U.S. courts will assert jurisdiction and compel repatriation when offshore trusts are used to avoid legal obligations.

Why Careful Planning Is Essential When Creating a Cook Islands Trust

The creation of a Cook Islands trust requires careful planning to mitigate the risk of legal challenges under U.S. law. Creation of the trust and any asset transfers to it must be carefully structured to withstand scrutiny under U.S. fraudulent transfer statutes, bankruptcy laws, and equitable principles related to constructive trusts.

  • Timing of transfers is critical, as courts often view transfers made shortly before creditor claims arise as attempts to defraud creditors, potentially resulting in fraudulent transfer claims.
  • Courts apply the principle of substance over form, meaning they will pierce formal offshore structures if the settlor retains control or influence over the trust, disregarding the protections nominally offered by the trust.
  • Past access to or benefit from trust assets can also undermine any claim of inability to comply with court orders, as courts may find that prior control establishes ongoing liability.
  • Failure to comply with court orders, such as repatriation orders, can expose the settlor to severe sanctions, including contempt findings, fines, and even imprisonment.
  • Finally, foreign trusts do not guarantee immunity from U.S. courts; as demonstrated in multiple cases, courts will assert jurisdiction and enforce repayment obligations when offshore trusts are used to evade legal responsibilities.

Careful, proactive legal advice and planning are therefore essential to maximize the protective benefits of a Cook Islands trust.

How Dilendorf Law Can Help

At Dilendorf Law Firm, we provide clients with independent risk assessments and feasibility studies for offshore asset protection structures, including Cook Islands Trusts.

Whether you’re seeking to protect cryptocurrency, public or private company stock, real estate, or other appreciated assets, it is critical to carefully evaluate the legal, tax, and enforcement risks before proceeding with any offshore planning.

Our firm has in-depth knowledge of the U.S. case law scrutinizing these trusts and provides clients with tailored advice that integrates compliance, control, and long-term viability.

Before transferring assets to a foreign trustee, make sure you fully understand the legal implications—and whether a domestic structure may serve your objectives more effectively.

Contact Max Dilendorf for a confidential consultation to determine whether a Cook Islands or other offshore trust is the right solution for your estate and asset protection goals. Contact us by email at info@dilendorf.com or call 212.457.9797.

 

Cook Islands Trust Risk Review & Advisory Services

At Dilendorf Law Firm, we provide independent legal risk assessments and structural reviews for clients who are considering, currently managing, or questioning the viability of offshore asset protection trusts—particularly Cook Islands Trusts.

Over the past three decades, U.S. courts have consistently scrutinized and litigated offshore trust structures. A single misstep—such as retaining control over trust assets, improperly structuring beneficiary rights, or failing to comply with U.S. disclosure requirements—can render the trust ineffective or expose the settlor to civil contempt, denial of discharge in bankruptcy, or significant tax penalties.

Our firm provides an unbiased evaluation grounded in real legal precedent. We’ve helped clients stress-test their offshore structures, avoid unintended liabilities, and design more secure, court-tested alternatives.

Whether you’re considering a new trust or already have one in place, our services help you understand what’s truly at stake.

Key Considerations When Evaluating a Cook Islands Trust:

  • For clients considering offshore trusts, Dilendorf Law Firm offers independent risk assessments and structural reviews.
  • The U.S. body of law targeting and dismantling offshore trusts—particularly Cook Islands-style asset protection trusts (APTs)—began forming in the early to mid-1990s and has developed over 30+ years of federal and state precedent.
  • Offshore structures don’t work in every situation. These structures require absolute and irrevocable surrender of control—legal title passes to a foreign trustee, and any retained power undermines the plan.
  • U.S. creditors’ attorneys will challenge every aspect of an offshore trust. There is a robust body of law in which courts have collapsed trusts, found debtors in contempt, and imprisoned them for refusing to repatriate assets.
  • Cook Islands trusts are self-settled, and many U.S. jurisdictions do not recognize asset protection in self-settled trusts. U.S. courts routinely apply state law instead of Cook Islands law. See Rush Univ. Med. Ctr. v. Sessions, 2012 IL 112906.
  • In Sattin v. Brooks (In re Brooks), 217 B.R. 98 (Bankr. D. Conn. 1998), the court invalidated offshore spendthrift trusts as unenforceable under Connecticut law, declaring the debtor’s interest reachable by creditors.
  • Courts don’t need to control the offshore trustee—they only need to control you, the settlor. Any retained ability to replace trustees, request distributions, or influence decisions may lead to civil contempt and incarceration. See FTC v. Affordable Media, LLC, 179 F.3d 1228 (9th Cir. 1999).
  • Transfers to offshore trusts are subject to a 10-year clawback under Bankruptcy Code § 548(e) if made with intent to hinder, delay, or defraud creditors. See In re Mortensen, 2011 WL 5025288 (Bankr. D. Alaska).
  • In U.S. v. Grant, 2013 WL 1729380 (S.D. Fla.), a federal judge issued a permanent injunction prohibiting the settlors and their family from ever receiving trust benefits after finding evidence of improper asset protection planning.
  • Offshore trusts require strict IRS compliance, including Forms 3520, 3520-A, and FBAR filings. Failure to comply can result in penalties often exceeding the value of the assets being protected.
  • Alternative domestic strategies—such as Family Limited Partnerships (FLPs) and Domestic Asset Protection Trusts (DAPTs)—can often provide more effective, cost-efficient, and court-accepted protection with full U.S. legal compliance.

Contact Us

If you are considering establishing an offshore asset protection trust or currently maintain one, contact Max Dilendorf for a consultation.  Contact us at (212) 457-9797 or email us at info@dilendorf.com.

Our firm offers legal clarity in a complex area—helping clients understand both the strengths and vulnerabilities of offshore structures before irreversible decisions are made.

Transferring appreciated assets—like crypto, stocks, or real estate—into a foreign non-grantor trust may seem like a smart move for asset protection. But if you’re not careful, it can come with a steep and unexpected tax bill.

One of the most commonly overlooked pitfalls is found in Internal Revenue Code Section 684(a). This provision requires that any transfer of appreciated property by a U.S. person to a foreign non-grantor trust is treated as a taxable sale—even if no money changed hands.

If you’re considering setting up an offshore trust—like a Cook Islands Trust—for crypto or other valuable assets, here’s what you need to know before moving forward.

The Hidden Trigger: IRC § 684(a)

The language of Section 684(a) is direct and unforgiving. Here is the full text:

IRC § 684(a) — Treatment of transfers to foreign trusts and estates.

“In general. In the case of any transfer of property by a United States person to a foreign estate or trust, such transfer shall be treated as a sale or exchange for an amount equal to the fair market value of the property transferred, and the transferor shall recognize as gain the excess of—

(1) the fair market value of the property so transferred, over

(2) the adjusted basis (for purposes of determining gain) of such property in the hands of the transferor.”

In plain English, this means that if you transfer appreciated property into a foreign trust—such as a Cook Islands Trust—the IRS treats that transfer as if you sold the property at its full fair market value on the date of the transfer.

It doesn’t matter that the transfer was a gift. The IRS still wants its cut.

How This Plays Out in Real Life

Let’s say you bought 100 BTC years ago when it was trading at $5,000. Now it’s worth $6 million. You decide to move it into a Cook Islands Trust for long-term protection and privacy.

That single move could trigger over $5 million in capital gains, immediately. And the tax will be due in the year of transfer—even though you didn’t sell anything or realize any cash.

The same rule applies if you transfer appreciated U.S. stocks, NFTs, or any other investment into a foreign non-grantor trust. IRC § 684(a) doesn’t discriminate by asset class—it applies across the board.

Domestic Trusts Don’t Trigger This Rule

The good news? If you transfer the same appreciated assets into a properly structured domestic non-grantor trust, such as a Wyoming Domestic Asset Protection Trust (DAPT), IRC § 684 does not apply.

Because domestic trusts are “U.S. persons” under IRC § 7701(a)(30)(E), the transfer is treated as a gift, not a sale. The trust simply inherits your basis under IRC § 1015, and no capital gains are triggered at the time of transfer (if a trust is properly structured).  

That’s a critical distinction—and one that often gets missed.

What You Should Do Before Transferring Assets to a Foreign Trust

At Dilendorf Law Firm, we regularly advise U.S. and international clients on the tax, legal, and structural implications of offshore trusts, including Cook Islands Trusts.

We provide:

✅ Independent legal risk assessments

✅ Structural reviews of existing offshore asset protection trusts

✅ Planning advice to avoid triggering unnecessary capital gains tax

✅ Compliance support for IRS reporting (Forms 3520, 3520-A, and more)

We help clients evaluate whether offshore structures make sense from both a legal and tax perspective. Many of these structures were set up hastily or without full understanding of the IRS rules—especially § 684.

In some cases, we recommend restructuring the trust, or funding the trust only with cash or low-basis assets. Every situation requires custom planning.

Final Thoughts

The key takeaway is this: Transferring appreciated assets into a foreign non-grantor trust is not a tax-free move. Under IRC § 684(a), you’re treated as if you sold the asset—meaning you’ll recognize capital gains the moment the trust takes title.

This rule has caught many well-meaning families, crypto holders, and business owners off guard—resulting in tax bills they never expected.

Before moving assets into a Cook Islands Trust—or any offshore trust—consult a knowledgeable professional who can walk you through the risks, planning strategies, and legal structure options.

Contact Us

To schedule a confidential consultation, contact Max Dilendorf, Esq. at:

Phone: 212.457.5757 | Email: md@dilendorf.com | Web: dilendorf.com

Max advises founders, families, and tech/crypto entrepreneurs on sophisticated estate planning and asset protection strategies—both onshore and offshore. From domestic trusts to complex offshore structures like Cook Islands Trusts, Max helps clients evaluate what works—and just as importantly, what doesn’t.

Disclaimer:

This content is provided for informational purposes only and does not constitute legal, tax, or financial advice. Nothing in this article should be construed as tax advice. Every individual’s tax situation is unique, and you should consult with a qualified tax advisor or attorney before making any decisions related to asset transfers, trust structures, or tax planning.

Welcome to the Crypto Theft Help Center, your starting point if your cryptocurrency was stolen from a U.S.-based exchange such as Coinbase, Kraken, or Binance. This resource hub was created by Max Dilendorf, a New York–based attorney who has represented victims of crypto theft nationwide for over six years.

Max has handled more than 100 cases involving stolen digital assets—ranging from SIM-swap attacks and exchange account takeovers to unauthorized access to decentralized wallets like MetaMask. He regularly represents clients in consumer arbitrations before AAA, JAMS, and NAM, and has taken cases through final evidentiary hearings (trials) in these forums.

This help center features a step-by-step video guide that walks victims through the critical stages of the recovery process—from securing compromised accounts and filing law enforcement reports to engaging blockchain forensics and initiating arbitration. If your crypto was stolen, acting quickly and strategically can make the difference. This resource is designed to help you do exactly that.

Episode 1 | Crypto Stolen? What to Do in the First 24 Hours

In this episode, attorney Max Dilendorf outlines the critical steps to take within the first 24 hours of discovering stolen cryptocurrency.

Acting fast can help contain the damage and preserve your recovery options.

You’ll learn how to secure your accounts, enable two-factor authentication, check for SIM-swap attacks, and freeze your credit reports.

Episode 2 | How to File an IC3 Report After Crypto Theft

In Episode 2, Max Dilendorf walks you through the step-by-step process of filing an IC3 report with the FBI—a critical first step after a crypto theft.

Filing this report creates an official record with federal law enforcement and can support future legal actions, forensic investigations, or arbitration.

Episode 3 | How to Hire a Blockchain Forensic Firm After Crypto Theft (Avoid Scams)

In Episode 3, we explain how to safely hire a blockchain forensic firm to trace stolen cryptocurrency—and how to avoid falling victim to fake recovery services.

With scams targeting theft victims on social media and messaging apps, we highlight warning signs and offer practical tips for verifying a firm’s credentials.

Episode 4 | Stolen Crypto? Unlock Arbitration with Your Exchange’s User Agreement

In Episode 4, we explain how to navigate the User Agreement of a U.S.-based crypto exchange after your funds have been stolen.

These agreements often contain arbitration clauses and liability waivers that limit your legal options.

We break down how to locate the relevant provisions, understand your rights, and take the proper steps to preserve your ability to file a claim.

Episode 5 | How to File an Arbitration Claim Against a Crypto Exchange (AAA Process Explained)

In Episode 5, we guide victims of crypto theft through the process of filing an arbitration demand with the American Arbitration Association (AAA).

Once an exchange denies responsibility, arbitration is often the only available legal path.

This episode outlines how to complete and submit the AAA Consumer Demand for Arbitration form, what supporting documents to include, and how to avoid procedural mistakes that could jeopardize your case.

Episode 6 | Denied by the Exchange? What to Know About Liability Waivers in User Agreements

In Episode 6, we walk viewers through how to file a demand for arbitration with the American Arbitration Association (AAA) after a crypto exchange denies responsibility for stolen funds.

We explain how to complete the required forms, what to include with your submission, and why careful preparation is essential to move your case forward.

Episode 7 | Arbitrating Stolen Crypto Claims: Full Timeline & What Victims Should Know

In this episode, we guide victims through the full lifecycle of a crypto arbitration case—from filing to final award—so they can plan ahead and avoid surprises.

Learn how long each stage takes, where delays occur, and how to stay on track during a complex, months-long process.

Episode 8 | How to Choose the Right Arbitrator for Your Crypto Theft Case

In this episode, we explain how the arbitrator selection process works in crypto theft cases filed through the American Arbitration Association (AAA).

From requesting a list of arbitrators to striking and ranking candidates, you’ll learn why selecting someone with crypto and cybersecurity expertise is critical—and how a single decision can shape the outcome of your case.

Episode 9 | Understanding Arbitration Fees for a Crypto Theft Claim Case

This episode provides a detailed look at the true cost of arbitrating a crypto theft claim—from AAA filing fees to expert witness retainers and evidentiary hearing expenses.

We also discuss key contractual provisions in User Agreements that may shift legal fees to the losing party, and how legal strategy can help manage financial risk.

Episode 10 | What Happens at the Final Evidentiary Hearing for a Crypto Theft Claim

In this episode, we walk viewers through the final evidentiary hearing—the critical stage where your crypto theft arbitration case is decided.

You’ll learn what to expect during virtual hearings, how evidence is presented, the role of expert witnesses, and how the arbitrator evaluates the case.

We also explain how long the hearing lasts and when to expect a final award.

Contact Us – Speak with a Crypto Theft Attorney Today

If your cryptocurrency was stolen from a U.S.-based exchange, time is critical. Dilendorf Law Firm has been representing victims of crypto theft since 2019, helping clients nationwide recover stolen digital assets and pursue claims against major platforms.

Schedule a confidential consultation with one of our experienced crypto lawyers to discuss your case, understand your legal options, and develop a recovery strategy. Email: info@dilendorf.com.  Phone: +1 (212) 457-9797

We stay up to date and track cases involving phishing attacks and sim swap affecting major cryptocurrency exchanges and mobile operators:

One of the largest cellphone carriers in the United States is facing yet another lawsuit by a digital currency investor over SIM swap fraud. T-Mobile failed in its duty to protect its users and resulted in the plaintiff’s loss of $55,000 worth of BTC, according to the lawsuit filed in Pennsylvania.

I am victim of a SIM Swap scam. Both T-Mobil and Coinbase.com where negligent and failed to protect me. I have all the evidence to prove my case.

An 84-year-old grandmother living in West Palm Beach started investing in cryptocurrency to help save up for her family’s future. Then, nearly all of the money she put into cryptocurrency vanished after she claims a hacker got into her accounts and drained it of about $800,000.

Coinbase users have filed 134 pages of complaints to the SEC alleging that their funds have been “stolen” by the exchange

Yesterday, Kevin Frye filed a complaint in the Southern District of Florida against T-Mobile USA, Inc. for allegedly conducting a “SIM-Swap” without his consent, resulting in the loss of tens of thousands of dollars worth of cryptocurrency. The plaintiff claimed that “T-Mobile Representatives were either complicit with the theft or grossly negligent” since they have been on “notice for years that their security measures were not adequate.”

A Pennsylvania woman who lost the equivalent of $20,000 in cryptocurrency as part of a mobile fraud scheme says T-Mobile failed to protect her account in the face of a wave of similar incidents.

Nine months before scammers stole $20,000 from Kesler’s Coinbase account, the suit argues, Jack Dorsey was the victim of another high profile SIM swap, in which outsiders seized control of the Twitter CEO’s information. Security journalist Brian Krebs also covered the issue in 2018, specifically reporting that a T-Mobile retail store employee was under investigation for making an unauthorized SIM swa

A man is suing Gemini, claiming it was negligent not to notice significant sums of money moved from his money market account to buy cryptocurrency on the exchange over seven days. While the trader was out of reach in the Australian outback, someone allegedly stole money from his CIT account and wired it to Gemini to purchase crypto. Later, he noticed fraudulent activity on his accounts with other banks, and is suing CIT in addition to Gemini, claiming it violated the Electronic Funds Transfer A

Hackers stole $21 million in Bitcoin and $15 million in Ethereum from retirement accounts held with IRA Financial Trust on February 8, according to a report from Bloomberg based on an anonymous source.

Interviews and thousands of complaints have revealed a pattern of account hacks where users have reported money vanishing from their accounts, reports CNBC. Once criminals gain access to an account, funds can be drained within minutes.

My account that my mom and I use together got hacked in June of this year. We lost $350,000.The hacker not only transferred out all of the crypto we owned, they used the bank accounts that were linked to purchase more. When we found out about the hack, we called our banks to stop the transfer of money. We also immediately contacted Coinbase to report the hack. However, Coinbase still let the purchase go through while the bank transactions were pending. Now, Coinbass is claiming that because we stopped our banks from transferring the money, we owe them $10,000 to reimburse them for the purchase.

California-headquartered crypto trading platform Coinbase—has been named in at least 115 complaints sent to the U.S. Securities and Exchange Commission and the California Department of Business Oversight

“I believe Coinbase has engaged in fraud by knowingly marketing a service it knows it cannot actually provide,” the filing from November last year read, adding: “Coinbase knows it does not have the infrastructure to timely and adequately meet customer needs.” At the time, bitcoin and other virtual currencies were rocketing in value, leading to an unprecedented interest from eager new investors.

It took only two minutes for the attacker to clean Sean Everett out of what was then a few thousand dollars’ worth of digital coins from his Coinbase wallet

Author Jeff Roberts said $250,000 was stolen from Coinbase in 2013/2014. Roberts claims Coinbase’s hot wallet was hacked just a year after the company’s inception in 2012, and that the hacker made away with $250,000 worth of Bitcoin

Olympia and Steve Kallman of Parma said they are dealing with some sleepless nights after police reported they had more than $22,000 taken by con artists from their Coinbase cryptocurrency virtual wallet back on Aug. 16.

T-Mobile is facing a multi-million dollar lawsuit after hackers were able to gain unauthorized access to a client’s account. Using information provided by the cellular company, hackers successfully bypassed their two-factor authentication security measures enabling them to obtain a SIM card with the client’s personal and financial information. $8.7 million in cryptocurrency was ultimately transferred out of the customer’s account.

T-Mobile has been hit with a multi-million-dollar lawsuit after Reginald Middleton lost millions of dollars when hackers gained unauthorized access to his account. The hackers used information supplied by T-Mobile to successfully circumvent the two-factor authentication measure, which allowed them to obtain a SIM card containing all of Middleton’s financial and personal information. Ultimately, $8.7 million in cryptocurrency was transferred out of Middleton’s account.

Richard Harris, the customer and plaintiff, is alleging T-Mobile’s misconduct including its failure to adequately protect customer information, hire appropriate support staff and its violation of federal and state laws led to his loss of 1.63 bitcoin.

Last night while I was sleeping my account was logged into (web) from Russia…

The Vidovics lost nearly $170,000 in the blink of an eye when someone hacked their Coinbase account.

John said his accounts with Coinbase and Coinbase Pro were emptied as he watched his phone screen.

….an increasing number of users of the currently highly popular cryptocurrency exchange called Coinbase have suddenly found their accounts on the platform empty. This is after hackers have managed to gain access to them and thoroughly drain their cryptocurrency wallets.

League of Legends superstar has had $200,000 in cryptocurrency stolen from them – directly from their Coinbase account

…an unauthorized user had changed Ms. Maguian’a passwords for trading platforms… Coinbase and initiated transactions that emptied her accounts of crypto valued at around $80,000 at the time

The Eleventh Circuit Court of Appeals ruled today that the class action against Coinbase…will be held in open court. The case in question alleges that Coinbase assisted in laundering around $8.2 mln of stolen Bitcoin (BTC) – valued at over $100 mln today.

The Vidovics lost nearly $170,000 in the blink of an eye when someone hacked their Coinbase account.

Dr. Anders Apgar, a Coinbase customer, said his account had a balance of more than $100,000 in crypto when it was hacked during a robocall.

I had $14,000+ USD in my coinbase pro account. The account was hacked at the money was switched over to crypto and sent to multiple people this occured several hours ago (05/14/2021). Case # 06082303

Tampa resident David Bryant knew something was wrong last October when he found Coinbase notifications deleted from his account and his login no longer worked. “I lost about $15,000 dollars worth of crypto,” David said.

A Texas man is suing Coinbase, the cryptocurrency trading platform. The man alleges his Coinbase account was breached to make a $50,000 unauthorized transaction. He says at least 1,000 other Coinbase accounts have also been breached.

A new report finds that Russia was linked to the majority of crypto ransomware invasions, siphoning the equivalent of $400 million in stolen funds to illicit addresses in that country. It appears Russia has strong ties to the majority of crypto hacks and cybercrimes, especially when you consider that 74% of ransomware revenue in 2021 — over $400 million worth of  cyptocurrency — went to accounts affiliated with the country in some way, according to a new report from cryptocurrency tracking and analytics firm, Chainalysis.

Case #05530638, #05542432. This all happened 4/15/21-4/16/21. How can I talk with someone from coinbase? I am so frustrated that someone stole my Bitcoin, ETH, and transferred $500 from my bank account and stole that too from my coinbase… Total almost $12,000. I am trying to understand what is going on and now I am completely blocked out of coinbase. I want answers!

An increasing number of users of the highly popular cryptocurrency exchange Coinbase have found their accounts on the platform empty after hackers managed to gain access to them and drain their cryptocurrency wallets.

Raza says Coinbase, the cryptocurrency exchange where he was robbed, has not been able to provide a solution and he thinks they need to step up security protocols.

 In four minutes, cyber looters pilfered $34,123 worth of virtual currency from a Virginia resident’s Coinbase (COIN) account, the 38-year-old told Yahoo Finance.

I received several txts last night sending me a 2fa code. I woke up and my bitcoin was transferred at 230am to some address. Any idea what happened? Was it my cell phone provider? Seems fishy to me since I could not detect any threats my phone. No idea how the culprit read my txt messages but oh well.

I am an active user of CoinBase and somehow my account was breached even with 2FA enabled. The hackers stole all of the coins in my account by converting them to BTC and sending them to their wallet. They then deposited $1k USD and purchased BTC using my debit card and stole it before I could lock my account down.

Taking my case to reddit. My account was hacked approximately 3 weeks ago and .50 BTC (approximately $23k USD) was stolen from my account. In summary, I decided to log into my account one day to check in on the balance. A hacker had locked my account out.

…hackers managed to get into the accounts and move funds off the platform, draining some accounts dry. Thousands of customers had already begun to complain to Coinbase that funds had vanished from their accounts…Coinbase did not disclose how much cryptocurrency was stolen in the attack.

CNBC interviewed Coinbase users across the country. The interviews and complaints revealed a pattern of account takeovers, where users see money suddenly vanish from their account, followed by poor customer service from the company. Since 2016, Coinbase users have filed more than 11,000 complaints against Coinbase with the Federal Trade Commission and Consumer Financial Protection Bureau, mostly related to customer service.

An increasing number of users of the highly popular cryptocurrency exchange Coinbase have found their accounts on the platform empty after hackers managed to gain access to them and drain their cryptocurrency wallets.

Loads of scams out there. Remember Coinbase does not support chat. You will never speak with a Coinbase employee.

I have been trying to contact Coinbase support since Thursday when I saw $25k BTC sold from my wallet without my consent and could not receive any assistance at all from Coinbase to protect my investment.

It was 10.6 bitcoins held in the wallet service Coinbase, the most well-funded and widely implemented service on the market.

All your money is gone. Whoops! Sorry for your loss. Some Coinbase account holders are losing their shit today as they look to their bank statements to find that the exchange has withdrawn excessive amounts of money from their accounts.

California-headquartered crypto trading platform Coinbase—has been named in at least 115 complaints sent to the U.S. Securities and Exchange Commission and the California Department of Business Oversight

“I believe Coinbase has engaged in fraud by knowingly marketing a service it knows it cannot actually provide,” the filing from November last year read, adding: “Coinbase knows it does not have the infrastructure to timely and adequately meet customer needs.” At the time, bitcoin and other virtual currencies were rocketing in value, leading to an unprecedented interest from eager new investors

Yesterday, Kevin Frye filed a complaint in the Southern District of Florida against T-Mobile USA, Inc. for allegedly conducting a “SIM-Swap” without his consent, resulting in the loss of tens of thousands of dollars worth of cryptocurrency. The plaintiff claimed that “T-Mobile Representatives were either complicit with the theft or grossly negligent” since they have been on “notice for years that their security measures were not adequate.”

A Pennsylvania woman who lost the equivalent of $20,000 in cryptocurrency as part of a mobile fraud scheme says T-Mobile failed to protect her account in the face of a wave of similar incidents.

Nine months before scammers stole $20,000 from Kesler’s Coinbase account, the suit argues, Jack Dorsey was the victim of another high profile SIM swap, in which outsiders seized control of the Twitter CEO’s information. Security journalist Brian Krebs also covered the issue in 2018, specifically reporting that a T-Mobile retail store employee was under investigation for making an unauthorized SIM swap.

Mr. Harris sued T-Mobile in July, alleging the company’s practices didn’t meet federal standards and allowed a hacker to take over his phone number in 2020 and steal bitcoin worth nearly $15,000 at the time, and more now.

T-Mobile declined to comment on the suit but motioned to move the case to arbitration. Like Verizon and AT&T, the company requires arbitration to resolve disputes in its terms of service, often leading to closed-door settlements.

Hackers stole the personal identification data for millions of past, present and prospective T-Mobile customers, leading to a huge class-action lawsuit.

Losing cellphone service is inconvenient. But in some cases, it also might mean you’re getting hacked.

“It’s a whole new wave of crime,” said Erin West, the deputy district attorney of Santa Clara County. “It’s a new way of stealing of money: They target people that they believe to have cryptocurrency,” she told CNBC.

Just when you think the massive T-Mobile hack can’t get any worse, on Friday the carrier announced that over 50 million people, including current and former customers as well as prepaid customers, were affected by the breach. Information like Social Security numbers, driver’s licenses and account PINs were exposed.

Cellphone carrier T-Mobile is being sued over allegations it failed to safeguard against a SIM swap scam that cost one customer $55,000 in lost.

The CEO of a crypto firm that recently settled with the SEC over its 2017 ICO is suing T-Mobile over a series of SIM-swaps that resulted in the loss of $8.7 million worth of crypto.

The suit accuses T-Mobile of having “abjectly failed” in its responsibility to protect the personal and financial information of its customers.

A victim of a crypto theft using SIM-swap attack has filed a lawsuit against T-Mobile, alleging the failure and negligence on the part of the US cell phone carrier in preventing these scams.

“This action arises out of T-Mobile’s systemic and repeated failures to protect and safeguard its customers’ highly sensitive personal and financial information against common, widely reported, and foreseeable attempts to illegally obtain such information,” the lawsuit alleged.

T-Mobile is currently facing a complaint against one of the victims of SIM swapping, a type of fraud.

Cheng believed that the attack would not have happened if not for “T-Mobile‘s negligent practices and its repeated failure to adhere to federal and state law.”

T-Mobile is facing yet another SIM swapping complaint involving cryptocurrency theft. Last week, a Philadelphia man named Richard Harris filed a complaint in the Eastern District of Pennsylvania against the wireless giant alleging he lost approximately $55,000 worth of Bitcoin due to the company’s failure to safeguard his account

The sim was successfully swapped which means that either it was done without the pin or the person knew the pin. Again, this is only possible if it was a T-Mobile employee and most likely one of the employees that help a month prior during the line add and upgrade.

When it comes to security or whatever it is leave T-Mobile. It is insider job someone is doing sim swaps.

T-Mobile confirmed this week that it was hit by a “highly sophisticated cyberattack” that exposed names, dates of birth, Social Security numbers and driver’s license information for more than 40 million consumers who had applied for credit with T-Mobile.

After a crazy week where T-Mobile handed over my phone number to a hacker twice, I now have my T-Mobile, Google, and Twitter accounts back under my control. However, the weak link in this situation remains and I’m wary of what could happen in the future.

American telecommunications provider T-Mobile has disclosed a data breach after an unknown number of customers were apparently affected by SIM swap attacks. SIM swap fraud (or SIM hijacking) allows scammers to take control of targets’ phone numbers after porting them using social engineering or after bribing mobile operator employees to a SIM controlled by the fraudsters.

Yesterday, someone went into a T-Mobile retail store used a fake California Drivers License to buy a copy of my SIM card.

And now for the crazy chain of events, where T-mobile allowed a complete stranger to do a SIM swap on me, and Coinbase allowed a complete stranger to change my Coinbase identity with no questions asked.

Silver Miller said that “with little more than a persuasive plea for assistance, a willing telecommunications carrier representative, and an electronic impersonation of the victim,” criminals can manage to steal millions of dollars targeting unsuspecting victims.

Hackers swapped my T-Mobile SIM card without my approval and methodically shut down access to most of my accounts and began reaching out to my Facebook friends asking to borrow crypto.

Coinbase has admitted that hackers stole crypto from thousands of its users’ accounts over a three-month period.

Bad actors were able to infiltrate the accounts of and steal cryptocurrency from around 6,000 Coinbase customers by exploiting a multi-factor authentication flaw.

Matthew doesn’t know how the hackers were able to access his Coinbase account, but he remembered that when he signed up with Coinbase, they advertised they had insurance.

My binance account was hacked a day before. All my funds were converted into ETC and withdrawn from binance. I received no confirmation mail for withdrawals too. All security steps – login password, 2FA, confirmation mail were compromised.

I don’t know how people can do this? I used strong password and also use all security option but no result this bloody f**king person got access my account.

The world’s crypto market turned red as rumours about Binance, the world’s most traded cryptocurrencies exchange, being hacked began circulating on the web yesterday morning. Some users reported that their alts on Binance were “market sold” at a loss and balances drained.

Yesterday, BeanThe5th made a thread in the popular /r/cryptocurrency subreddit, regarding a theft that has occurred on his or her Binance account. Many users who saw this Reddit thread were quite surprised, as it has become common knowledge that Binance is one of the most reputable and secure exchanges that exist.

Hackers have stolen $570 million from a blockchain linked with Binance. The largest crypto exchange has had to temporarily halt the operation of its Binance Smart Chain after the exploit.1 Since the hack, Binance Coin’s (BNB) price has also dropped noticeably, with the token down 3.5% in the last 24 hours. At the time of writing, it is trading at $281.

Hackers just stole $40 million worth of bitcoin from Binance, one of the largest cryptocurrency exchanges in the world. It’s hardly the first time crypto has been targeted by thieves. For a technology that’s supposed to be hyper secure, in practice, it’s often proven itself to be, well, not.

Binance, the world’s biggest cryptocurrency exchange, is investigating a hacking incident that affected a number of crypto tokens Friday. According to its founder and CEO Changpeng Zhao, a private key, used to encrypt or decrypt data, had been hacked.

“Initial analysis is developer private key was hacked, and the hacker updated the smart contract to a more malicious one,” Zhao said on Twitter, adding that the Ankr and Hay tokens were affected.

On Tuesday, May 7, Binance, the world’s largest cryptocurrency exchange, announced that malicious actors had compromised user application programming interface (API) keys and two-factor authentication (2FA) codes, enabling them to access the company’s hot wallet and steal more than 7,000 bitcoin (BTC).

Cryptocurrency exchange Binance temporarily suspended its blockchain network after hackers made off with around $570 million worth of its BNB token.

Hello, I have been impersonated and sim swapped, they hacked my emails, twitter, facebook, exchanges, literally everything including binance, which they stole 2 btc (daily limit) from today and will steal more if the account isn’t frozen by tomorrow. They logged in and somehow disabled my google authenticator and I cannot get into my account, microsoft is working on giving me the hacked email back that is related to binance but they say it will take 3 days to escalate the ticket. In 3 days the hackers will have already taken my entire balance so I really need the binance account frozen now before they can steal more.

My account was compromised with multiple security layers on it. Google 2FA and Email Authentication which i both had on it. My google 2FA was on a device only for my google authentication apps, I take necessary steps to prevent hacks & The crazy thing is i always receive emails when anything is changing or so on so when the hack was happening binance did not not alert my email or anything. All my securities was reset and email was changed.

Someone made a withdrawal on my Binance account when I was sleeping last night and took all my money away. My Binance account had 2FA on and everything was safe and secure but somehow the hacker managed to hack it and withdrew all my holdings out. Binance support does not have a hacked feature, so it’s pissing me off. Is there anyway that I can get it back? This is all my life savings.

Crypto exchange Gemini Trust Co. lacked proper safeguards that resulted in retirement-account holders losing around $36 million in Bitcoin and Ether when the master key got hacked, IRA Financial Trust said in a new lawsuit.

Then, on Tuesday of this this week, someone posted the entire stolen database for free on Breach Forums. It’s unclear whether this individual previously attempted to sell the database but was unsuccessful, covertly purchased it, or otherwise obtained it through some other means. We also still don’t know when the data breach occurred, though the second post attempting to sell the database claimed it was obtained in September.

Regardless, the personal information of Gemini’s 5.7 million customers is now publicly available online.

San Francisco resident Robert Ross, a father of two, noticed his phone suddenly lose its signal on Oct. 26. Confused, he went to a nearby Apple store and later contacted his service provider, AT&T. But he wasn’t quick enough to stop a hacker from draining $500,000 from two separate accounts he had at Coinbase and Gemini, according to Santa Clara officials.

My account on Gemini was hacked. My password and email address on Gemini were both changed. I have been trading on Gemini for 4 years. Gemini now claims that there is no account at Gemini with my email. I have a ton of USD in my Gemini account and they will not even confirm that the funds are frozen. There is no person

Government Resources:

Contact our team to discuss your case against a cryptocurrency exchange.  Email: info@dilendorf.com; Phone: 212.447.9797.

If your cryptocurrency was stolen from an exchange like Coinbase, Kraken, Binance, or another U.S.-based platform, this guide is your roadmap for recovery. Developed by Max Dilendorf, a New York–based crypto fraud attorney with over six years of experience and more than 100 arbitrations under his belt, this page demystifies the arbitration process in 2025.

Max has represented victims of theft—including SIM-swap attacks, crypto account takeovers, and unauthorized access from decentralized wallets—in consumer arbitrations before AAA, JAMS, and NAM. Many of his cases have proceeded to final evidentiary hearings, where the merits are argued in full.

This 10-part video series walks you through every critical stage: from securing your digital assets immediately after the theft, filing law enforcement reports, and hiring blockchain forensics, to navigating arbitration clauses, choosing the right arbitrator, managing fees, and preparing for hearing. Whether you’re filing a claim today or planning ahead, this guide has you covered.

Arbitrating Crypto Theft Claims: Video Series

What to Do in the First 24 Hours After Crypto Theft

Learn immediate actions to secure your accounts, enable two-factor authentication, check for SIM-swap attacks, and freeze your credit reports to protect your identity and assets.

How to File an IC3 Report After Crypto Theft

Understand the importance of filing a report with the FBI’s Internet Crime Complaint Center (IC3) and how it supports future legal actions and forensic investigations.

How to Hire a Blockchain Forensic Firm After Crypto Theft

Discover how to safely hire a blockchain forensic firm to trace stolen cryptocurrency and avoid falling victim to fraudulent recovery services.

Unlocking Arbitration with Your Exchange’s User Agreement

Navigate the arbitration clauses and liability waivers in your exchange’s User Agreement to understand your rights and the steps to preserve your ability to file a claim.

How to File an Arbitration Claim Against a Crypto Exchange

Get a step-by-step guide on filing an arbitration demand with the American Arbitration Association (AAA), including completing the necessary forms and avoiding procedural mistakes.

Understanding Liability Waivers in User Agreements

Learn how to interpret and challenge liability waivers in User Agreements, especially when an exchange denies responsibility for stolen funds.

Arbitrating Stolen Crypto Claims: Full Timeline & What Victims Should Know

Gain insights into the full lifecycle of a crypto arbitration case, from filing to final award, and learn how to plan ahead and avoid surprises.

How to Choose the Right Arbitrator for Your Crypto Theft Case

Understand the arbitrator selection process in crypto theft cases filed through the AAA and why selecting someone with crypto and cybersecurity expertise is critical.

Understanding Arbitration Fees for a Crypto Theft Claim Case

Get a detailed look at the true cost of arbitrating a crypto theft claim, including filing fees, expert witness retainers, and evidentiary hearing expenses.

What Happens at the Final Evidentiary Hearing for a Crypto Theft Claim

Learn what to expect during the final evidentiary hearing, how evidence is presented, the role of expert witnesses, and how the arbitrator evaluates the case.

For more information and to watch the full video series, visit the Crypto Theft Lawyer YouTube Playlist.

If you need personalized guidance, contact Max Dilendorf—a crypto fraud lawyer with extensive experience recovering stolen cryptocurrency from U.S.-based exchanges. Reach us at 212.457.9797 or email us at info@dilendorf.com.

Government Sim Swap Resources:

We stay up to date and track cases involving phishing attacks and sim swap affecting major cryptocurrency exchanges and mobile operators:

IRA Financial Trust, the crypto retirement account provider that in February lost $37 million to theft, sued Gemini – its custodian and trading partner – for allegedly sloppy security protocols that it claimed led to its customers’ accounts getting drained.

One of the largest cellphone carriers in the United States is facing yet another lawsuit by a digital currency investor over SIM swap fraud. T-Mobile failed in its duty to protect its users and resulted in the plaintiff’s loss of $55,000 worth of BTC, according to the lawsuit filed in Pennsylvania.

I am victim of a SIM Swap scam. Both T-Mobil and Coinbase.com where negligent and failed to protect me. I have all the evidence to prove my case.

An 84-year-old grandmother living in West Palm Beach started investing in cryptocurrency to help save up for her family’s future. Then, nearly all of the money she put into cryptocurrency vanished after she claims a hacker got into her accounts and drained it of about $800,000.

Coinbase users have filed 134 pages of complaints to the SEC alleging that their funds have been “stolen” by the exchange

Yesterday, Kevin Frye filed a complaint in the Southern District of Florida against T-Mobile USA, Inc. for allegedly conducting a “SIM-Swap” without his consent, resulting in the loss of tens of thousands of dollars worth of cryptocurrency. The plaintiff claimed that “T-Mobile Representatives were either complicit with the theft or grossly negligent” since they have been on “notice for years that their security measures were not adequate.”

A Pennsylvania woman who lost the equivalent of $20,000 in cryptocurrency as part of a mobile fraud scheme says T-Mobile failed to protect her account in the face of a wave of similar incidents.

Nine months before scammers stole $20,000 from Kesler’s Coinbase account, the suit argues, Jack Dorsey was the victim of another high profile SIM swap, in which outsiders seized control of the Twitter CEO’s information. Security journalist Brian Krebs also covered the issue in 2018, specifically reporting that a T-Mobile retail store employee was under investigation for making an unauthorized SIM swa

A man is suing Gemini, claiming it was negligent not to notice significant sums of money moved from his money market account to buy cryptocurrency on the exchange over seven days. While the trader was out of reach in the Australian outback, someone allegedly stole money from his CIT account and wired it to Gemini to purchase crypto. Later, he noticed fraudulent activity on his accounts with other banks, and is suing CIT in addition to Gemini, claiming it violated the Electronic Funds Transfer A

Hackers stole $21 million in Bitcoin and $15 million in Ethereum from retirement accounts held with IRA Financial Trust on February 8, according to a report from Bloomberg based on an anonymous source.

Interviews and thousands of complaints have revealed a pattern of account hacks where users have reported money vanishing from their accounts, reports CNBC. Once criminals gain access to an account, funds can be drained within minutes.

My account that my mom and I use together got hacked in June of this year. We lost $350,000.The hacker not only transferred out all of the crypto we owned, they used the bank accounts that were linked to purchase more. When we found out about the hack, we called our banks to stop the transfer of money. We also immediately contacted Coinbase to report the hack. However, Coinbase still let the purchase go through while the bank transactions were pending. Now, Coinbass is claiming that because we stopped our banks from transferring the money, we owe them $10,000 to reimburse them for the purchase.

California-headquartered crypto trading platform Coinbase—has been named in at least 115 complaints sent to the U.S. Securities and Exchange Commission and the California Department of Business Oversight

“I believe Coinbase has engaged in fraud by knowingly marketing a service it knows it cannot actually provide,” the filing from November last year read, adding: “Coinbase knows it does not have the infrastructure to timely and adequately meet customer needs.” At the time, bitcoin and other virtual currencies were rocketing in value, leading to an unprecedented interest from eager new investors.

It took only two minutes for the attacker to clean Sean Everett out of what was then a few thousand dollars’ worth of digital coins from his Coinbase wallet

Author Jeff Roberts said $250,000 was stolen from Coinbase in 2013/2014. Roberts claims Coinbase’s hot wallet was hacked just a year after the company’s inception in 2012, and that the hacker made away with $250,000 worth of Bitcoin

Olympia and Steve Kallman of Parma said they are dealing with some sleepless nights after police reported they had more than $22,000 taken by con artists from their Coinbase cryptocurrency virtual wallet back on Aug. 16.

T-Mobile is facing a multi-million dollar lawsuit after hackers were able to gain unauthorized access to a client’s account. Using information provided by the cellular company, hackers successfully bypassed their two-factor authentication security measures enabling them to obtain a SIM card with the client’s personal and financial information. $8.7 million in cryptocurrency was ultimately transferred out of the customer’s account.

T-Mobile has been hit with a multi-million-dollar lawsuit after Reginald Middleton lost millions of dollars when hackers gained unauthorized access to his account. The hackers used information supplied by T-Mobile to successfully circumvent the two-factor authentication measure, which allowed them to obtain a SIM card containing all of Middleton’s financial and personal information. Ultimately, $8.7 million in cryptocurrency was transferred out of Middleton’s account.

Richard Harris, the customer and plaintiff, is alleging T-Mobile’s misconduct including its failure to adequately protect customer information, hire appropriate support staff and its violation of federal and state laws led to his loss of 1.63 bitcoin.

Last night while I was sleeping my account was logged into (web) from Russia…

The Vidovics lost nearly $170,000 in the blink of an eye when someone hacked their Coinbase account.

John said his accounts with Coinbase and Coinbase Pro were emptied as he watched his phone screen.

….an increasing number of users of the currently highly popular cryptocurrency exchange called Coinbase have suddenly found their accounts on the platform empty. This is after hackers have managed to gain access to them and thoroughly drain their cryptocurrency wallets.

League of Legends superstar has had $200,000 in cryptocurrency stolen from them – directly from their Coinbase account

…an unauthorized user had changed Ms. Maguian’a passwords for trading platforms… Coinbase and initiated transactions that emptied her accounts of crypto valued at around $80,000 at the time

The Eleventh Circuit Court of Appeals ruled today that the class action against Coinbase…will be held in open court. The case in question alleges that Coinbase assisted in laundering around $8.2 mln of stolen Bitcoin (BTC) – valued at over $100 mln today.

The Vidovics lost nearly $170,000 in the blink of an eye when someone hacked their Coinbase account.

Dr. Anders Apgar, a Coinbase customer, said his account had a balance of more than $100,000 in crypto when it was hacked during a robocall.

I had $14,000+ USD in my coinbase pro account. The account was hacked at the money was switched over to crypto and sent to multiple people this occured several hours ago (05/14/2021). Case # 06082303

Tampa resident David Bryant knew something was wrong last October when he found Coinbase notifications deleted from his account and his login no longer worked. “I lost about $15,000 dollars worth of crypto,” David said.

A Texas man is suing Coinbase, the cryptocurrency trading platform. The man alleges his Coinbase account was breached to make a $50,000 unauthorized transaction. He says at least 1,000 other Coinbase accounts have also been breached.

A new report finds that Russia was linked to the majority of crypto ransomware invasions, siphoning the equivalent of $400 million in stolen funds to illicit addresses in that country. It appears Russia has strong ties to the majority of crypto hacks and cybercrimes, especially when you consider that 74% of ransomware revenue in 2021 — over $400 million worth of  cyptocurrency — went to accounts affiliated with the country in some way, according to a new report from cryptocurrency tracking and analytics firm, Chainalysis.

Case #05530638, #05542432. This all happened 4/15/21-4/16/21. How can I talk with someone from coinbase? I am so frustrated that someone stole my Bitcoin, ETH, and transferred $500 from my bank account and stole that too from my coinbase… Total almost $12,000. I am trying to understand what is going on and now I am completely blocked out of coinbase. I want answers!

An increasing number of users of the highly popular cryptocurrency exchange Coinbase have found their accounts on the platform empty after hackers managed to gain access to them and drain their cryptocurrency wallets.

Raza says Coinbase, the cryptocurrency exchange where he was robbed, has not been able to provide a solution and he thinks they need to step up security protocols.

 In four minutes, cyber looters pilfered $34,123 worth of virtual currency from a Virginia resident’s Coinbase (COIN) account, the 38-year-old told Yahoo Finance.

I received several txts last night sending me a 2fa code. I woke up and my bitcoin was transferred at 230am to some address. Any idea what happened? Was it my cell phone provider? Seems fishy to me since I could not detect any threats my phone. No idea how the culprit read my txt messages but oh well.

I am an active user of CoinBase and somehow my account was breached even with 2FA enabled. The hackers stole all of the coins in my account by converting them to BTC and sending them to their wallet. They then deposited $1k USD and purchased BTC using my debit card and stole it before I could lock my account down.

Taking my case to reddit. My account was hacked approximately 3 weeks ago and .50 BTC (approximately $23k USD) was stolen from my account. In summary, I decided to log into my account one day to check in on the balance. A hacker had locked my account out.

…hackers managed to get into the accounts and move funds off the platform, draining some accounts dry. Thousands of customers had already begun to complain to Coinbase that funds had vanished from their accounts…Coinbase did not disclose how much cryptocurrency was stolen in the attack.

CNBC interviewed Coinbase users across the country. The interviews and complaints revealed a pattern of account takeovers, where users see money suddenly vanish from their account, followed by poor customer service from the company. Since 2016, Coinbase users have filed more than 11,000 complaints against Coinbase with the Federal Trade Commission and Consumer Financial Protection Bureau, mostly related to customer service.

An increasing number of users of the highly popular cryptocurrency exchange Coinbase have found their accounts on the platform empty after hackers managed to gain access to them and drain their cryptocurrency wallets.

Loads of scams out there. Remember Coinbase does not support chat. You will never speak with a Coinbase employee.

I have been trying to contact Coinbase support since Thursday when I saw $25k BTC sold from my wallet without my consent and could not receive any assistance at all from Coinbase to protect my investment.

It was 10.6 bitcoins held in the wallet service Coinbase, the most well-funded and widely implemented service on the market.

All your money is gone. Whoops! Sorry for your loss. Some Coinbase account holders are losing their shit today as they look to their bank statements to find that the exchange has withdrawn excessive amounts of money from their accounts.

California-headquartered crypto trading platform Coinbase—has been named in at least 115 complaints sent to the U.S. Securities and Exchange Commission and the California Department of Business Oversight

“I believe Coinbase has engaged in fraud by knowingly marketing a service it knows it cannot actually provide,” the filing from November last year read, adding: “Coinbase knows it does not have the infrastructure to timely and adequately meet customer needs.” At the time, bitcoin and other virtual currencies were rocketing in value, leading to an unprecedented interest from eager new investors

Yesterday, Kevin Frye filed a complaint in the Southern District of Florida against T-Mobile USA, Inc. for allegedly conducting a “SIM-Swap” without his consent, resulting in the loss of tens of thousands of dollars worth of cryptocurrency. The plaintiff claimed that “T-Mobile Representatives were either complicit with the theft or grossly negligent” since they have been on “notice for years that their security measures were not adequate.”

A Pennsylvania woman who lost the equivalent of $20,000 in cryptocurrency as part of a mobile fraud scheme says T-Mobile failed to protect her account in the face of a wave of similar incidents.

Nine months before scammers stole $20,000 from Kesler’s Coinbase account, the suit argues, Jack Dorsey was the victim of another high profile SIM swap, in which outsiders seized control of the Twitter CEO’s information. Security journalist Brian Krebs also covered the issue in 2018, specifically reporting that a T-Mobile retail store employee was under investigation for making an unauthorized SIM swap.

Mr. Harris sued T-Mobile in July, alleging the company’s practices didn’t meet federal standards and allowed a hacker to take over his phone number in 2020 and steal bitcoin worth nearly $15,000 at the time, and more now.

T-Mobile declined to comment on the suit but motioned to move the case to arbitration. Like Verizon and AT&T, the company requires arbitration to resolve disputes in its terms of service, often leading to closed-door settlements.

Hackers stole the personal identification data for millions of past, present and prospective T-Mobile customers, leading to a huge class-action lawsuit.

Losing cellphone service is inconvenient. But in some cases, it also might mean you’re getting hacked.

“It’s a whole new wave of crime,” said Erin West, the deputy district attorney of Santa Clara County. “It’s a new way of stealing of money: They target people that they believe to have cryptocurrency,” she told CNBC.

Just when you think the massive T-Mobile hack can’t get any worse, on Friday the carrier announced that over 50 million people, including current and former customers as well as prepaid customers, were affected by the breach. Information like Social Security numbers, driver’s licenses and account PINs were exposed.

Cellphone carrier T-Mobile is being sued over allegations it failed to safeguard against a SIM swap scam that cost one customer $55,000 in lost.

The CEO of a crypto firm that recently settled with the SEC over its 2017 ICO is suing T-Mobile over a series of SIM-swaps that resulted in the loss of $8.7 million worth of crypto.

The suit accuses T-Mobile of having “abjectly failed” in its responsibility to protect the personal and financial information of its customers.

A victim of a crypto theft using SIM-swap attack has filed a lawsuit against T-Mobile, alleging the failure and negligence on the part of the US cell phone carrier in preventing these scams.

“This action arises out of T-Mobile’s systemic and repeated failures to protect and safeguard its customers’ highly sensitive personal and financial information against common, widely reported, and foreseeable attempts to illegally obtain such information,” the lawsuit alleged.

T-Mobile is currently facing a complaint against one of the victims of SIM swapping, a type of fraud.

Cheng believed that the attack would not have happened if not for “T-Mobile‘s negligent practices and its repeated failure to adhere to federal and state law.”

T-Mobile is facing yet another SIM swapping complaint involving cryptocurrency theft. Last week, a Philadelphia man named Richard Harris filed a complaint in the Eastern District of Pennsylvania against the wireless giant alleging he lost approximately $55,000 worth of Bitcoin due to the company’s failure to safeguard his account

The sim was successfully swapped which means that either it was done without the pin or the person knew the pin. Again, this is only possible if it was a T-Mobile employee and most likely one of the employees that help a month prior during the line add and upgrade.

When it comes to security or whatever it is leave T-Mobile. It is insider job someone is doing sim swaps.

T-Mobile confirmed this week that it was hit by a “highly sophisticated cyberattack” that exposed names, dates of birth, Social Security numbers and driver’s license information for more than 40 million consumers who had applied for credit with T-Mobile.

After a crazy week where T-Mobile handed over my phone number to a hacker twice, I now have my T-Mobile, Google, and Twitter accounts back under my control. However, the weak link in this situation remains and I’m wary of what could happen in the future.

American telecommunications provider T-Mobile has disclosed a data breach after an unknown number of customers were apparently affected by SIM swap attacks. SIM swap fraud (or SIM hijacking) allows scammers to take control of targets’ phone numbers after porting them using social engineering or after bribing mobile operator employees to a SIM controlled by the fraudsters.

Yesterday, someone went into a T-Mobile retail store used a fake California Drivers License to buy a copy of my SIM card.

And now for the crazy chain of events, where T-mobile allowed a complete stranger to do a SIM swap on me, and Coinbase allowed a complete stranger to change my Coinbase identity with no questions asked.

Silver Miller said that “with little more than a persuasive plea for assistance, a willing telecommunications carrier representative, and an electronic impersonation of the victim,” criminals can manage to steal millions of dollars targeting unsuspecting victims.

Hackers swapped my T-Mobile SIM card without my approval and methodically shut down access to most of my accounts and began reaching out to my Facebook friends asking to borrow crypto.

Coinbase has admitted that hackers stole crypto from thousands of its users’ accounts over a three-month period.

Bad actors were able to infiltrate the accounts of and steal cryptocurrency from around 6,000 Coinbase customers by exploiting a multi-factor authentication flaw.

Matthew doesn’t know how the hackers were able to access his Coinbase account, but he remembered that when he signed up with Coinbase, they advertised they had insurance.

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