Two brothers, Anton Peraire-Bueno, aged 24, of Boston, and James Pepaire-Bueno, aged 28, of New York, were charged with conspiracy to commit wire fraud, wire fraud, and conspiracy to commit money laundering via cryptocurrency.
They allegedly exploited the integrity of the Ethereum blockchain and stole approximately $25 million worth of cryptocurrency deceitfully in just about 12 seconds. They were arrested in Boston and New York respectively on Wednesday. They will appear before U.S. Magistrate Judge Paul G. Levenson for the District of Massachusetts and U.S. Magistrate Judge Valerie Figueredo for the Southern District of New York today.
According to the court document, Anton Peraire-Bueno and James Pepaire-Bueno are siblings who pursued studies in mathematics and computer science at one of the country’s most esteemed universities. Leveraging their honed expertise gained during their education, coupled with their proficiency in cryptocurrency trading, the brothers allegedly exploited the Ethereum blockchain’s integrity to fraudulently amass approximately $25 million worth of cryptocurrency from unsuspecting traders.
This purported exploit, believed to be the first of its kind, involved altering the processes and protocols governing transaction validation and addition to the Ethereum blockchain. By doing so, they purportedly gained unauthorised access to pending private transactions, altering specific transactions to pilfer victims’ cryptocurrency. Upon acquiring the stolen funds, the defendants reportedly rebuffed requests for restitution and took various measures to conceal their unlawful gains.
Over several months, Anton Peraire-Bueno and James Pepaire-Bueno meticulously orchestrated the scheme. They familiarised themselves with the trading patterns of their eventual victims and adopted various strategies to mask their identities and facilitate the laundering of stolen proceeds. This included establishing shell companies, utilising multiple private cryptocurrency addresses, and engaging foreign cryptocurrency exchanges. Subsequently, they funnelled the stolen cryptocurrency through a complex web of transactions aimed at obfuscating its origins and ownership.
The investigation into the case was led by the IRS-CI New York’s Cyber Investigations Unit, with support from the U.S. Customs and Border Protection and the New York City Police Department. The prosecution is being handled by Assistant U.S. Attorneys Rushmi Bhaskaran and Danielle Kudla for the Southern District of New York.
It’s important to note that an indictment merely constitutes an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.