Two brothers were accused of stealing $25 million in cryptocurrency

Two brothers were arrested for allegedly stealing around $25 million in cryptocurrency in just a few seconds by first “rigging” the Ethereum blockchain. The brothers – Anton Peraire-Bueno and James Peraire-Bueno – studied mathematics and computer science at MIT and used skills acquired “from one of the most prestigious universities in the country” to exploit “security vulnerabilities of the Ethereum blockchain to illegally appropriate funds,” prosecutors said. They were charged with wire fraud, conspiracy to commit wire fraud and money laundering conspiracy.

Unfortunately for the defendants, their alleged crimes did not elude Justice Department prosecutors and Internal Revenue Service agents, who exposed an unprecedented wire fraud and money laundering scheme. this precedent. Although the heist was accomplished in just a few seconds, charging documents say the brothers planned it for months. They are said to have “carefully planned and executed” the attack, which began in December 2022. The brothers allegedly created “an online document” detailing their four-step plan: 1) Decoy, 2) Open Block, 3) Search and 4) Spread.

The brothers set up a series of “Ethereum validators” in a manner that concealed their identities through the use of front companies, intermediary cryptocurrency addresses, offshore exchanges, and layered networks. confidentiality,” according to the indictment. They are said to have targeted three traders – whose behavior they had studied for months beforehand – and set up “a series of test trades or ‘bait trades'” to attract traders. bots that traders use.

Prosecutors accused the brothers of exploiting a vulnerability in Ethereum’s code, which has since been patched. “By doing so, they fraudulently gained access to pending private transactions and used that access to alter certain transactions and obtain victims’ cryptocurrency,” it said in a statement. Bulletin of the Ministry of Justice.

After stealing approximately $25 million in cryptocurrency, the Peraire-Bueno brothers are believed to have laundered the money through several front companies. The brothers’ online search history in the weeks after the alleged theft included “top crypto lawyer”, “US law validity period”, “Ethereum access database” fraud” and “the statute of limitations for money laundering”. Charging documents say a victim and their lawyer contacted the Peraire-Bueno brothers multiple times between April and June 2023, as well as a representative from Ethereum.

If convicted, each could face up to 20 years in prison for each charge, according to the Department of Justice.