Two Brothers Are Accused of Stealing $25 Million Worth of Cryptocurrencies - Latest Global News

Two Brothers Are Accused of Stealing $25 Million Worth of Cryptocurrencies

Two brothers were taken into federal custody on Tuesday for allegedly stealing about $25 million worth of cryptocurrencies in a matter of seconds in a “first-of-its-kind manipulation” of the Ethereum blockchain. The brothers – Anton Peraire-Bueno and James Peraire-Bueno – studied mathematics and computer science at MIT and used the skills they acquired “at one of the most prestigious universities in the country” to “exploit the integrity of the Ethereum blockchain.” “to obtain the funds through fraudulent means,” prosecutors say. The brothers were charged wire fraud, conspiracy to commit wire fraud and conspiracy to commit money laundering.

“Unfortunately for the defendants, their alleged crimes were no match for Justice Department prosecutors and IRS agents who uncovered this first-of-its-kind fraud and money laundering scheme,” Assistant Attorney General Lisa Monaco said in a news release.

Although the robbery was committed within seconds, the brothers spent months planning it, the documents show. The indictment alleges that the Peraire-Bueno brothers “carefully planned and carried out” the attack, which began sometime in December 2022. The brothers have reportedly created “an online document” outlining their four-step plan: 1) The Bait, 2) Unblinding the Block, 3) The Search, and 4) The Spread.

The brothers set up a series of Ethereum validators “in a manner that concealed their identities through the use of shell companies, intermediary cryptocurrency addresses, foreign exchange exchanges and a privacy layer network,” the indictment says. They allegedly targeted three traders – whose behavior they had studied for months in advance, prosecutors allege – and conducted “a series of test transactions or ‘bait transactions'” to lure the bots used by the traders.

Prosecutors allege the brothers exploited a vulnerability in Etherum’s code that has since been patched. “In doing so, they fraudulently gained access to pending private transactions and used this access to alter certain transactions and obtain their victims’ cryptocurrency,” the Justice Department press release said.

After stealing approximately $25 million worth of cryptocurrencies, the Peraire-Bueno brothers allegedly laundered the funds through multiple shell companies. The brothers’ online search history in the weeks following the alleged theft included “top crypto lawyers” and “how long does it take us?” [sic] of restrictions,” “fraudulent Ethereum access database,” and “money laundering statue.” [sic] of restrictions.” The charging documents allege a victim and his attorney repeatedly contacted the Peraire-Bueno brothers between April and June 2023, as did an Ethereum representative.

If convicted, each could face up to 20 years in prison on each of the three counts, according to the Justice Department.

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