SIM Swapping Crypto - The Ultimate Safety Guide

SIM swap fraud is on the rise as scammers exploit a weakness in two-factor authentication and verification. When it comes to safeguarding your crypto, it's time to step up your game using the ultimate steps we will outline below.

To Prevent SIM Swapping, Understand How It Happens

SIM cards are small cards that contain microchips that enable your phone to work. They must be inserted into your smartphone in order to make or receive calls and texts. SIM swapping is the process of transferring a SIM card from one phone to another.

The SIM card in your phone contains a lot of information. This data allows you to make calls and send texts. Without the SIM card, you would only be able to use your smartphone for activities that don't require a phone number, like accessing the internet on a Wi-Fi network or taking photos.

A SIM swap scam is when criminals take over your phone by convincing your carrier to connect your phone number to a SIM card that they have. These scammers essentially take over your mobile phone’s number.

Next, Criminals Make Their Move

In order to steal your phone number, scammers will first gather as much personal information on you as they can. They will then engage in social engineering in order to try and impersonate you.

First, the scammers will call your mobile carrier and claim to have lost or damaged their SIM card. They will then ask the customer service representative to activate a new SIM card in the fraudster’s possession.

If a fraudster port outs your phone number, it will go to their device instead of yours. They are able to do this by answering the security questions your mobile carrier asks or by providing personal information to your smartphone provider’s customer service rep.

When this SIM swap fraud happens, a criminal obtains your personal information and then uses it to impersonate you and may try to enter your bank account using your username and password.

To access your account, the bank then sends a code by text (two-factor authentication) to your smartphone number. However, if the scammer has done a SIM swap, they will now have control of your number and can use the code to enter your bank account or crypto accounts.

SMS-based authentication is a convenient way to improve security because it assumes that the account owner has control over the device. However, SIM swapping is a loophole that allows crooks to bypass this type of security. You can protect yourself against SIM swapping by being mindful of the logins and passwords you use to access your online bank or credit card accounts along with the step-by-step approach in our ultimate list below.

The Ways You Are Targeted For A SIM Swap

The data that scammers have collected on you through phishing emails, malware, or social media research can be used to scam you.

For example, a scammer might send you an email pretending to be from your smartphone provider. The email might say that you need to click on a link to keep your account open. When you do, you’re taken to a new page that asks you for personal information, including your name, birthdate, and passwords.

Beware of online scams that ask for personal information, such as your Social Security number. Once you provide this information and click “Send,” the scammers can use it to carry out a SIM swap scam.

Other scammers may trick you into clicking on email links that install malware onto your computer. This malware can record your keystrokes, which the fraudsters can use to obtain passwords and security question answers. This allows them to successfully carry out a SIM swap.

Fraudsters might also buy your personal and financial information on the dark web. This, too, would arm these con artists with the information they need to successfully work their scam.

Once scammers provide your smartphone providers with the information they have gotten from you or the dark web, they use it to convince your provider to switch your number to a new SIM card. Scammers can then use this opportunity to commit various types of fraud, such as identity theft or financial theft.

Criminals who gain access to your cellphone number can use it to intercept text messages from banks and other organizations. This gives them the ability to reset passwords and gain access to your accounts. They may also set up a second bank account in your name, which can be harder to detect and stop.

Who you use as a phone provider can matter, and we are going to cover more about a mainstream alternative that is battling SIM Swapping for crypto investors and other professionals in our advanced step section of the guide.

Law Enforcement & Technology Providers Sound The Alarm 

The FBI is warning of a significant increase in scams using smartphone SIM swapping to defraud victims. This type of fraud occurs when scammers contact your mobile phone carrier and trick the customer service representative into activating a SIM card that the fraudsters have. Once this occurs, the scammers have control over your phone number.

And while two-factor authentication has been growing in use using a smartphone's text abilities, the FBI’s warning verifies a similar statement from Microsoft confirms you should avoid using phone numbers as your means of a second authentication.

In December, T-Mobile confirmed that SIM swapping was behind a major data breach. A former employee of a US mobile carrier was sentenced in October for taking bribes of up to $500 a day to swap phone numbers.

Operators also lack procedures to help customers when they become victims of SIM-swapping scams, however, there have been some improvements made in this area, just not enough yet.

Now that you are well informed of what SIM Swapping can mean for cryptocurrency investors, it's time to take action using our below step-by-step guide that will keep you safer.

The Step by Step Keep You Safer From SIM Swapping

We've broken the ultimate guide down into three segments, Basic, Intermediate, and Advanced, to help you understand everything you should consider doing depending on your level of cryptocurrency investing and risk tolerance.

Basic Steps - 1 and 2

1. Do not brag or share information about your assets, financial or otherwise, including ownership or investment of cryptocurrency tokens or coins. This applies to sharing on social media such as Twitter or Facebook or in more traditional forum chats.

2. Take it a step further and do not post personal information on the web, such as your mobile phone number, physical or mailing address, or other information that could help a criminal identify who you are. The less information about you that is public, the less of a target you will be.

Intermediate Steps - 3 and 4

3. Get in the habit of not providing your mobile number or account information over the phone to customer service representatives who request your account password or pin. Always verify who the representative is. Hang up on the customer service representative if you feel the call is suspicious and call back the company directly to ensure the call is real if need be.

4. Use a strong and unique password to access your online accounts, especially your crypto-related accounts such as Coinbase or other trading platforms where you may have cryptocurrency stored. Use a strong password manager such as LastPass, 1Password, Google Password Manager, DashLane, or other reputable providers.

Advanced Step - 5

5. Switch mobile phone providers to a company such as Efani, which is a solution for a phone service plan with guaranteed prevention from SIM swap, eavesdropping, and location tracking built-in.

The Action Is Yours To Take As A Crypto Investor

In summary, SIM Swapping can not always be prevented unless a specialty provider is used, but there are several ways if you continue using standard phone services to keep your chances of being SIM swapped minimized by following the above step-by-step guidelines.

The action is yours to take, and if you need assistance, speak with technology-savvy friends and family who you deeply trust to help with the technology mentioned in the guide.