New York Attorney General Secures $6 Million in NovaTech Crypto Fraud Case
TREE NEWS reports: New York Attorney General Letitia James announced on October 23 that her office has recovered nearly $6 million from four major promoters of the NovaTechFx and AWS Mining cryptocurrency pyramid schemes. The funds will be used to compensate victims, and the four individuals have been permanently barred from the securities, commodities, and cryptocurrency industries.
The scheme, which operated from August 2019 to April 2023, targeted immigrant communities—particularly Haitian-Americans—through prayer groups, social media, and WhatsApp chats. More than 11,000 New Yorkers were affected, losing tens of millions of dollars. Investors deposited over $1 billion in crypto assets into NovaTech, but less than $26 million was actually traded on its platform, indicating that the vast majority of funds were misappropriated.
Legal Actions and Industry Implications
The Attorney General’s office has also filed a motion seeking $1.3 billion in restitution and disgorgement from NovaTech founders Cynthia and Eddy Petion. The couple was already subject to a default judgment in August 2025 and banned from the securities, commodities, and crypto industries.
This case underscores the persistent risks of fraudulent schemes masquerading as legitimate crypto investment opportunities. The use of community-based recruitment, particularly within immigrant communities, highlights the need for targeted investor education and stronger enforcement. The scale of the fraud—over $1 billion in deposits with minimal actual trading—demonstrates how bad actors can exploit the hype around digital assets to perpetrate large-scale Ponzi schemes.
Regulators are increasingly focusing on crypto fraud, with the NYAG’s actions sending a clear message that such schemes will be pursued aggressively. The permanent industry bans and substantial financial penalties reflect a commitment to deterring future misconduct.
Forward Look
As crypto adoption grows, especially among retail investors, enforcement actions like this will be crucial in maintaining trust. The case also raises questions about the effectiveness of self-regulation and the role of social media platforms in facilitating such schemes. Moving forward, expect increased scrutiny of crypto investment offerings and greater coordination between state and federal regulators to protect vulnerable communities.
