A judge has rejected two brothers’ attempt to dismiss crypto fraud charges after they allegedly stole $25 million from the Ethereum blockchain using an MEV bot.
According to a U.S. court document, District Judge Jessica Clarke denied the motion to dismiss charges against Anton and James Peraire-Bueno, MIT-educated brothers accused of exploiting a vulnerability in the Ethereum network to siphon cryptocurrency from victims.
The brothers argued that the wire fraud statute did not clearly specify whether their actions were “permitted by the system’s code” and claimed they were unfairly targeted by victim trading bots engaged in manipulative trading.
However, Judge Clarke ruled, “Defendants’ motions to dismiss are each DENIED, except with respect to the receiving stolen property charge.” The denial was based on the brothers’ failure to provide fair notice, failure to allege essential elements, and failure to state key facts.
Initially, the brothers faced charges including wire fraud, conspiracy to receive stolen property, conspiracy to commit wire fraud, and conspiracy to commit money laundering.
The receiving stolen property charge was dropped after the brothers cited a Department of Justice memo aimed at limiting regulatory overreach on digital assets.
With their dismissal motion denied, the brothers are scheduled to stand trial in October 2025. The court order was issued by Judge Clarke in August 2024.
How did the brothers exploit MEV bots to steal $25 million?
In April 2023, Anton and James Peraire-Bueno allegedly leveraged their computer science expertise to manipulate Maximal Extractable Value (MEV) bots, stealing up to $25 million in on-chain funds in just 12 seconds. They set up a company called Pine Needle Inc. as a front to carry out the scheme.
According to court documents, the brothers devised a four-step plan: bait, block, search, and propagation. They targeted 16 Ethereum validators, using 529.5 ETH (about $880,000) to execute the attack through “lure transactions” designed to attract the MEV bots.
“As expected, the Victim Traders’ MEV Bots proposed eight bundles that included the Lure Transactions and were submitted to the Builder. For each of these eight bundles, the Victim Traders bought coded front-run trades,” the judge noted.
The stolen funds were then laundered via a bank deposit and dispersed across eight different cryptocurrency addresses. The brothers used a cryptocurrency exchange that did not require Know-Your-Customer (KYC) verification to help cover their tracks.
