SEC Charges NovaTech Founders in $650 Million Crypto Ponzi Scheme

The U.S. Securities and Exchange Commission (SEC) has charged Cynthia and Eddy Petion, founders of NovaTech, with orchestrating a Ponzi scheme disguised as a cryptocurrency investment programme.

Targeted Communities

The SEC alleges that NovaTech, operating as a multi-level marketing (MLM) company, targeted the Haitian-American community between 2019 and 2023.

Quote from SEC

Eric Werner, director of the SEC’s Fort Worth regional office, stated, "NovaTech and the Petions caused untold losses to tens of thousands of victims around the world."

New York Attorney General's Lawsuit

Separately, New York Attorney General Letitia James has sued NovaTech and AWS Mining for running an illegal pyramid scheme, allegedly scamming investors out of $1 billion.

False Promises

NovaTech promised investors profit and safety by claiming to invest in cryptocurrency and foreign exchange markets. Instead, the funds were used to pay existing investors and promoters, while siphoning millions for personal gain.

Collapse and Consequences

When NovaTech collapsed, most investors could not withdraw their investments, leading to significant losses. The SEC’s complaint did not specify the type of cryptocurrency involved.

Promoters Charged

The SEC also charged several NovaTech promoters who allegedly continued to recruit investors despite being aware of regulatory red flags. One promoter, Martin Zizi, has agreed to a partial settlement, including a $100,000 civil penalty.