An alleged attempt to steal $116m of crypto assets from the Mango Markets platform has led to the arrest of a US citizen in Puerto Rico, pending transport to appear before a court in New York.

Avraham Eisenberg, 27, faces parallel criminal and civil charges brought by the Department of Justice (DOJ) and the CFTC respectively.

The SEC also alleges that Eisenberg launched an attack on the platform on October 11, 2022, by using an account he controlled on Mango Markets to sell a large number of perpetual futures for MNGO tokens, and then use a separate account to buy the same futures. He is further alleged to have put through a series of large purchases aimed at artificially raising the price of MNGO tokens relative to USD Coin.

Draining assets

The SEC complaint states that Eisenberg succeeded in inflating the price of MNGO tokens before using the new value to borrow and withdraw around $116m from Mango Markets, effectively draining all assets from the platform.

“Eisenberg engaged in a manipulative and deceptive scheme to artificially inflate the price of the MNGO token, which was purchased and sold as a crypto asset security, in order to borrow and then withdraw nearly all available assets from Mango Markets, which left the platform at a deficit when the security price returned to its pre-manipulation level,” said David Hirsch, Chief of the Crypto Assets and Cyber Unit. 

The SEC has filed charges including violation of anti-fraud and market manipulation provisions contained within securities laws. It says it is seeking “permanent injunctive relief, a conduct-based injunction, disgorgement with prejudgment interest, and civil penalties”.