TechFlow news, on October 10, according to DL News, Mango Labs has become embroiled in new legal disputes just weeks after reaching a settlement with the U.S. Securities and Exchange Commission (SEC). On October 7, Mango Labs filed a lawsuit in Puerto Rico accusing two senior contributors of Mango DAO, John Kramer and Max Schneider, of misappropriating over $10 million in DAO funds to the detriment of other members. The lawsuit alleges that the defendants secretly purchased MNGO tokens from FTX, manipulated the MNGO market to artificially inflate the token price, and violated their fiduciary duties by selling the tokens back to Mango DAO at inflated prices. Both Kramer and Schneider deny any wrongdoing.
The lawsuit states that Kramer and Schneider took advantage of the period during the Eisenberg case proceedings when many Mango DAO members were unavailable as witnesses to carry out their scheme. Specifically, they secretly acquired 333 million MNGO tokens from FTX's bankruptcy proceedings at prices below market value, then used DAO proposals to sell these tokens back to the DAO at significantly higher prices, thereby draining the DAO's treasury. When other Mango DAO members raised suspicions, Kramer and Schneider refused to disclose their involvement, instead falsely claiming that the purchases were made by a "strategic and aggressive investor."
