A trader accused of stealing $110 million in 20 minutes by scamming the Mango Markets cryptocurrency exchange will face a criminal trial in New York on Dec. 4.
(Bloomberg) — A trader accused of stealing $110 million in 20 minutes by scamming the Mango Markets cryptocurrency exchange will face a criminal trial in New York on Dec. 4.
US District Judge Richard Berman in Manhattan set the trial date Wednesday for Avraham Eisenberg, who was indicted Jan. 9 on charges of commodities fraud, commodities manipulation and wire fraud. He pleaded not guilty.
Prosecutors claim Eisenberg manipulated Mango Markets futures contracts on Oct. 11, when he drove up the price of swaps by 1,300%. He used them to borrow about $110 million of cryptocurrency from other Mango depositors, the US alleges.
Four days later he posted on Twitter: “I was involved with a team that operated a highly profitable trading strategy last week.” He also said he believed “all of our actions were legal open market actions, using the protocol as designed.”
Mango Labs LLC, in a civil lawsuit, claims Eisenberg fraudulently took $114 million and then coerced members of the Mango Decentralized Autonomous Organization, or DAO, which governs the protocol, to let him return only $67 million. Mango claims that agreement, which left Eisenberg with $47 million, is invalid. The civil case is on hold pending the criminal case.
Prosecutors say Eisenberg “had no intention of repaying the borrowed funds but rather to steal those funds,” according to the indictment.
An FBI affidavit said he flew to Israel the day after the incident. Eisenberg, a native of Suffern, New York, later returned to Puerto Rico, where he had been living, and was arrested there on Dec. 26.
He joined a court hearing Wednesday by video from the Essex County Jail in Newark, New Jersey, where he’s detained.
Eisenberg faces as long as 20 years in prison on the wire fraud charge. He’s also been sued by the US Securities and Exchange Commission and the Commodity Futures Trading Commission.
The criminal case is US v. Eisenberg, 23-cr-10, US District Court, Southern District of New York (Manhattan).
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