SEC Charges Mango Markets Exploiter for Allegedly Stealing $116M in Crypto

The SEC has charged Avraham Eisenberg with manipulating the MNGO token, which the business allegedly offered as a security, on the Mango Markets platform.

The US Securities and Exchange Commission has joined the Commodity Futures Trading Commission and others in filing concurrent charges against the crypto user allegedly responsible for a multimillion-dollar Mango Markets exploit.

The SEC claimed in a Jan. 20 notice that Avraham Eisenberg misused Mango Markets’ MNGO governance token, allowing him to steal about $116 million in cryptocurrencies from the site. According to the lawsuit, Eisenberg allegedly made a series of significant MNGO transactions in order to artificially boost the token’s price relative to USD Coin before draining the assets from Mango Markets.

“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,” said David Hirsch, head of the SEC’s Crypto Assets and Cyber Unit.

The SEC charged Eisenberg with violating securities laws’ anti-fraud and market manipulation provisions, with cooperation from the U.S. Attorney’s Office for the Southern District of New York, the FBI, and the CFTC. The banking regulator will seek “permanent injunctive relief, a conduct-based injunction, disgorgement with prejudgment interest, and civil penalties,” according to the statement.

Eisenberg is accused of carrying out a large Mango Markets fraud in October, withdrawing around $50 million in USDC, $27 million in Marinade Staked SOL (mSOL), $24 million in SOL, and $15 million in MNGO. Mango Markets later announced that $67 million worth of assets had been refunded, with Eisenberg publicly declaring he believed his activities had been legal as part of a “very profitable trading plan”.

Eisenberg was apprehended by authorities in Puerto Rico in December. According to the FBI complaint, he “willfully and deliberately” participated in a scam involving the “intentional and artificial manipulation” of the price of perpetual futures on the crypto platform. On January 9, the CFTC filed its own case, accusing Eisenberg of market manipulation.

Following a detention hearing in January, a magistrate court ordered Eisenberg to be detained until his trial, stating that it was the only way to secure his appearance. Since his arrest in December, the Mango Markets swindler has not tweeted to his Twitter account.