Avraham Eisenberg, a self-proclaimed exploiter of Solana-based platform Mango Markets, is being sued by Mango Labs, the developer of the DeFi lending protocol, and Eisenberg is said to still hold $47 million from the exploit, as well as damages.
According to the indictment, on October 11, 2022, Eisenberg conducted a malicious attack on Mango Markets by manipulating the value of the Mango Token (MNGO) and fraudulently transferred approximately $114 million of Mango Markets depositors to his own account middle.
On Oct. 15, Eisenberg posted a Twitter thread in which he described being "involved with a team operating highly profitable trading strategies." Eisenberg stated that he believed the exploit was carried out through a "legitimate open market operation, using a well-designed protocol."
The lawsuit seeks to undo an agreement between Mango DAO, the decentralized autonomous organization that manages the protocol, and Eisenberg in the days after the exploit to return $67 million of the $114 million total.
If he does, the DAO stated that "once the tokens are sent back, there will be no criminal investigation or freezing of funds." Because the Mango DAO’s $10 million insurance fund against such attacks was insufficient to cover depositor losses, the DAO was forced to accept the agreement, the lawsuit says.
Although Eisenberg sought to compensate himself in the settlement with Mango DAO, that did not stop the Department of Justice from arresting him on December 27, 2022, for commodity fraud and manipulation charges. On Jan. 9, the CFTC charged Eisenberg with two counts of market manipulation.
Last week, the SEC added to its own complaint, claiming that Eisenberg "violated multiple provisions of the federal securities laws, including certain antifraud and antimarket manipulation provisions."
