Ivy League-Educated Brothers Steal Cryptocurrency Worth $25M

Two brothers who graduated from an Ivy League school have been charged with federal fraud offenses for allegedly stealing about $25 million of cryptocurrency — in just 12 seconds.

The Department of Justice issued a press release this week that said they arrested James Pepaire-Bueno, 28, of New York along with his brother Anton Peraire-Bueno, 24, of Boston. They’re being charged with “conspiracy to commit wire fraud, wire fraud and conspiracy to commit money laundering.”

For months, the brothers meticulously planned a scheme that allowed them to exploit the integrity of the second biggest blockchain in the world — Ethereum. In doing so, they were able to steal about $25 million in only 12 seconds.

According to Damian Williams, a U.S. Attorney for the Southern District of New York, the brothers are math and computer science graduates from “one of the most prestigious universities in the world.”

While Williams didn’t name the school the brothers attended, a CBS News report identified that they went to MIT, or the Massachusetts Institute of Technology.

James graduated from there in 2019 with a bachelor’s degree in aerospace engineering, computer science and mathematics. He then earned a master’s degree in astronautics and aeronautics from the school in 2021

Anton graduated from MIT just a few months ago, having received a bachelor’s degree in computer science.

As part of their scheme, they compromised the blockchain’s protocols, which affected millions of users who rely on Ethereum for cryptocurrency.

In doing so, the brothers were able to access user transactions and then alter them, according to prosecutors. They’re also being charged with refusing to return the cryptocurrency they stole, as has been requested of them.

According to the DOJ, the brothers had plans to launder the cryptocurrency they stole using multiple transactions, “setting up shell companies and using multiple private cryptocurrency addresses and foreign cryptocurrency exchanges.”

As Williams noted:

“This alleged scheme was novel and has never before been charged.”

If the brothers are found guilty in court, they could face a sentence of 60 years in jail — 20 years for each of the charges, according to the DOJ.

In the DOJ’s press release, Lisa Monaco, the deputy attorney general, said:

“As cryptocurrency markets continue to evolve, the Department will continue to root out fraud, support victims and restore confidence to these markets.”

This is just the latest stain on the cryptocurrency market, which has experienced a lot of negative press over the last year or so.

The most infamous case is that of Sam Bankman-Fried, the founder of the cryptocurrency exchange FTX. He was seen as a straight-laced businessman who had the interests of crypto users in mind, and was also viewed as sort of a savior for the industry.

In 2022, though, he was arrested on fraud charges after FTX collapsed overnight. He had apparently leveraged money from users of FTX to fund another research firm that he owned.

SBF, as he is known, was found guilty of many of those charges in November last year, and was subsequently sentenced to spend 25 years in jail in March of this year.

He also had to forfeit $11 billion.