NY Attorney General Sues Crypto Firms NovaTech & AWS Mining Over $1B Fraud Allegations
Summary:
New York's Attorney General, Letitia James, has initiated a lawsuit against NovaTech, its founders, Cynthia and Eddy Petion, and AWS Mining for allegedly conducting a Ponzi scheme that led to financial losses over $1 billion. More than 11,000 New Yorkers, primarily from the Haitian community, were reportedly affected by these fraudulent activities. The case also reveals a potential connection with a similarly named firm in South Africa. James is now seeking compensation, restoration and a prohibition on the defendants from doing business in New York.
A lawsuit has been launched by Letitia James, New York's Attorney General, claiming that two cryptographic firms, under the same founders, swindled individuals out of more than $1 billion. The cryptocurrency trading company, NovaTech and its founders, Cynthia and Eddy Petion, as well as the now defunct cryptocurrency mining company, AWS Mining and others have been named in the lawsuit. The legal action indicates over 11,000 residents of New York State, with a high proportion from the Haitian community, have lost millions of dollars after investing in NovaTech. The case accuses NovaTech of operating a Ponzi scheme and using religious allusions to entice clients. Documentation from the case against NovaTech indicates that it falsely claimed licensing and registration status. NovaTech was registered in St. Vincent and the Grenadines until January 2023 when the Financial Services Authority rescinded the registration. The company folded in May 2023.
Before NovaTech, the Petions were involved in AWS Mining, which closed in 2019. According to allegations, AWS Mining, too, was a Ponzi scheme, but failed to generate sufficient income to fulfill its promised returns. During the company’s operation between 2019 and 2023, $1 billion in cryptocurrency was deposited, with only $26 million traded, according to the lawsuit. James seeks restitution, compensation and a prohibition on AWS Mining, NovaTech and the Petions from trading in New York. “The actual risks of unregulated cryptocurrency platforms are visible in schemes like these, but New Yorkers can be confident that we will exploit every tool at our disposal to clamp down on crypto fraudsters," James stated.
On the NovaTech website, currently active, Cynthia Petion states that the company's funds were lost due to a data breach and are being recovered. From available information, the company started claiming it was hacked in May 2023. Another company, bearing the same NovaTech name and logo and using Cynthia Petion's picture on its Facebook page, was operational in South Africa in 2022 and 2023. The Texas State Securities Board launched a cease-and-desist order in 2018 against a cryptographic company called AWS Mining, accusing it of tactics similar to those used by the Petions, but they were not named in that action.
Published At
6/7/2024 12:00:11 AM
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