New York AG Demands $1.37B from NovaTech Founders in Ponzi Scheme Case

New York Attorney General Letitia James has filed a court request demanding that the founders of the now-defunct crypto and forex trading platform NovaTech, Cynthia and Eddy Petion, along with related companies, pay a staggering $1.37 billion in restitution for their involvement in a Ponzi scheme. This legal action follows a default judgment issued in August 2025, where the court found the Petions and their companies liable after they failed to respond to the lawsuit.

The AG's motion seeks to recover about $1.13 billion in investor funds, in addition to $232.5 million in accrued interest, according to a court filing made public on Thursday. This case highlights the significant financial impact of the alleged scheme, which left more than 11,000 New Yorkers facing substantial losses.

Between August 2019 and May 2023, investors reportedly deposited around $1.16 billion into NovaTech’s crypto wallets. However, only a fraction of this amount—approximately $26 million—was actually allocated to trading activities through the platform’s trading provider, B2Broker. The AG's office indicated that the promoters of NovaTech specifically targeted Haitian and other immigrant communities, utilizing prayer groups, social media, and messaging platforms like WhatsApp to lure in investors with promises of high returns and recruitment bonuses.

Settlements for Victims of the Scheme

In a related development, four individuals who played a role in recruiting investors have agreed to pay nearly $6 million in settlements aimed at compensating victims of the scheme. This settlement is part of the broader effort by the AG’s office to address the fallout from NovaTech and an earlier venture, AWS Mining, which also collapsed in 2019.

Follow The Money

The AG's office has stated that the financial fallout from NovaTech's collapse in 2023 has left tens of thousands of investors unable to withdraw their funds, further complicating the recovery process. James initially filed lawsuits against NovaTech, AWS Mining, and other associated entities in June 2024, aiming to hold those responsible accountable for their actions.

As the case unfolds, there remain critical questions about how any recovered funds will be distributed to the victims and what enforcement measures will be taken to ensure compliance with the court's orders. Cointelegraph reached out to the New York Attorney General’s Office for insights on these matters but did not receive a response before publication.