Teen faces $71 million lawsuit over cryptocurrency heist

Published: 26/05/2020 | Last Updated: 05/06/2020

Ellis Pinsky is facing a lawsuit worth $71.4 million. According to the lawsuit, he allegedly stole millions of dollars’ worth of cryptocurrency.

Apparently, the heist took place in January 2018 when a group of hackers from the United States and parts of Europe scam their way into $23.8 million worth of cryptocurrency. Their victim is Michael Terpin, and he is suing Pinsky claiming that he was one of the perpetrators of the hack.

However, there is an interesting catch to this massive lawsuit: Pinsky was just 15 years old when the hack took place. Now, Terpin is suing the teenager, who he claims as “an evil mastermind,” for $71.4 million.

A talented computer kid

According to some of Pinsky’s acquaintances, he is just a normal teenager. He lives with his family in New York and loves to play video games.

However, people close to Pinksy claims that aside from being a normal teenager, he does manifest a certain level of aptitude when it comes to computer hacking. Though, some of his peers think that he was able to amass a fortune by trading bitcoin and other cryptocurrency.

Terpin’s complaint claims that Pinsky is the leader of the hacking group that targeted him. Terpin is also a computer-savvy person, and is one of the pioneer of the cryptocurrency industry.

In his complaint, Terpin claims, “In his early teens, [Ellis] began hacking computers with the mission of accessing his victims’ private accounts where they stole their cryptocurrency holdings or private information.”

Among the exploits allegedly used by Pinsky to hack its targets is the technique called SIM-swapping. This particular technique allows hackers to copy their target’s SIM card information and transfer it into a blank SIMM card that they control. These malicious SIM card are then sold over the Internet and in many hacker forums.

How he got busted

Apparently, Pinsky is a known bully online. An insider said that he usually frequent video chatrooms where he would boast about his fortune and hacking skills. Coincidentally, he is also known for hacking his peers.

One such target is a peer who lives near him. Pinsky enlisted the help of this peer to launder the money that he allegedly stole from Terpin. Everything went haywire when this pal accidentally sent $700,000 to a wrong bitcoin wallet.

Since it is extremely hard to recover cryptocurrency once it is transferred to a different account, Pinsky forced this peer to pay him back through any means possible. Sometimes, his peer claims, Pinsky will force him to sell drugs.

Terpin said that he waited for Pinsky to turn 18 before filing his lawsuit, this way he will be tried as an adult. However, there are some inconsistences to this especially if the statute of limitation is considered.

It is important to note that Pinsky was just 15 years old when he committed the heist. Now that the heist has been more than three years, some legal scholars are not totally convinced if the charges will stick.

As of this writing, no arrest has been made yet and Pinsky still lives in his parent’s home.