The United States Department of Justice announced the arrest of Mango Markets operator Avraham Eisenberg in Puerto Rico.
Avraham Eisenberg is accused of carrying out the $110 million Mango Markets crypto exchange exploit in October of this year. The hacker has charges against him in the Southern District Court of New York.
Damian Williams, the US Attorney for the Southern District of New York, as well as Assistant US Attorneys Thomas Burnett and Noah Solowiejczyk, ordered Eisenberg’s arrest.
Accused of Fraud and Manipulation Charges
The Department of Justice complaint dated December 27 states the following:
“I attach complaint 22 Mag. 10337, which accuses Avraham Eisenberg of crimes of market manipulation. The complaint is sealed. Last night, the defendant was arrested in the District of Puerto Rico and will be presented later today. Attached is a proposed Order to open the claim for the Court’s consideration.”
The 22 Mag. Filing 10337 charges Eisenberg with two counts. Charge one is for commodity fraud, while charge two is for commodity tampering.
Following the October hack, Avraham Eisenberg acknowledged masterminding the over $100 million exploit on the Mango Markets platform. Interestingly, he even defended himself by arguing that the hacking of the platform was actually within the bounds of the law:
“I believe all of our actions were legal open market actions, using the protocol as designed, even if the development team did not fully anticipate all the consequences of setting parameters the way they are.”
Mango Markets Exploit Was a Team Effort
Avraham Eisenberg acted with others, leading a team to pull off the feat of decentralized exchange Mango Markets. He manipulated the price of the native MNGO token to buy a massive position.
The hacker also artificially inflated prices by up to 1,300%, allowing him to borrow other tokens as collateral. At the time, he said he was negotiating a settlement agreement with the insurance fund. However, at no time did he show any intention of returning it.
The arrest request from the United States Department of Justice emphasized the following:
“AVRAHAM EISENBERG, defendant, knowingly and intentionally manipulated and attempted to manipulate the price of a product in interstate commerce, and for future delivery and subject to the rules of a registered entity, and of an exchange, namely, EISENBERG engaged in a scheme involving the intentional and artificial manipulation of the price of perpetual futures contracts on a cryptocurrency exchange called Mango Markets.”
BeInCrypto had reported on the incident in late October after Eisenberg claimed that he “didn’t care” about the criticism he had received for his actions. He even argued that lending platforms are willing to lend at the current price of a token. In November, Eisenberg tried to replicate the exploit on Aave but was unsuccessful.
By Audy Castaneda
