KEY POINTS
- The brothers, reportedly educated at MIT, are faced with multiple fraud-related charges
- The scheme was allegedly planned for months before its execution early in April 2023
- The Peraire-Bueno brothers allegedly refused to return the funds to the victims
Two brothers were arrested by law enforcement after they allegedly stole $25 million in Ether (ETH), the Ethereum blockchain's native cryptocurrency, within approximately 12 seconds, indictment documents revealed Thursday.
Brothers Anton Peraire-Bueno, 24, and James Peraire-Bueno, 28, were charged with conspiracy to commit wire fraud, wire fraud, and conspiracy to commit money laundering, according to an indictment unsealed Wednesday, as per a press release from the U.S. Department of Justice (DOJ).
Deputy Attorney General Lisa Monaco described the brothers' scheme as the "first-of-its-kind wire fraud and money laundering" plot carried out in the vast Ethereum space. "As alleged in today's indictment, the Peraire-Bueno brothers stole $25 million in Ethereum cryptocurrency through a technologically sophisticated, cutting-edge scheme they plotted for months and executed in seconds," she said.
For U.S. Attorney Damian Williams, who indicted the brothers, the scheme "calls for the very integrity of the blockchain into question." He said the siblings used their specialty skills in computer science and math to "tamper with and manipulate the protocols relied upon by millions of Ethereum users across the globe." The execution of the theft was a "novel" one and has never been charged in the history of the blockchain network, Williams noted.
The brothers were educated at the Massachusetts Institute of Technology (MIT), one of the world's most prestigious tech universities, as per multiple reports.
For several months, the Peraire-Bueno brothers allegedly studied the trading behaviors of victim/investors whose digital assets they ultimately stole. They allegedly concealed their identities and worked on hiding the pilfered assets, "including by setting up shell companies and using multiple private cryptocurrency addresses and foreign cryptocurrency exchanges."
The brothers allegedly carried out the exploit on or before April 2, 2023. Several victims, and an Ethereum representative reached out to the defendants to ask for the stolen funds' return, but the brothers "agreed with each other to launder the proceeds of their fraud," as per the unsealed indictment.
Williams said prosecutors and law enforcement agencies will continue to work together in the pursuit of bad actors who continuously attack the traditional and decentralized financial systems.
If convicted of the charges, the brothers each face a maximum of 20 years behind bars for each count.
News of the brothers' arrest comes amid continuing hacking incidents across the crypto sector. During the April 28 through May 4 period alone, the crypto industry lost over $71 million to a slew of security hacks and scams. In the said week, a crypto whale lost 1,155 Wrapped Bitcoins (WBTC) to an "address poisoning attack."
