New York Attorney General Letitia James has filed a lawsuit against NovaTechFx, a crypto trading company, and AWS Mining, a digital asset mining company.
The lawsuit alleges their involvement in illegal pyramid schemes that defrauded over 11,000 individuals and hundreds of thousands of investors, resulting in losses exceeding a billion dollars in cryptocurrency.
$1 Billion Fraud Scheme
According to a June 6 press release, the lawsuit targets NovaTechFx, its founders Cynthia and Eddy Petion, and AWS Mining for organizing illegal pyramid schemes that lured investors with promises of substantial returns on investments.
The alleged targets of these schemes were predominantly immigrant communities, with a focus on Haitian New Yorkers, who were enticed through various channels, including prayer groups, social media platforms, and WhatsApp group chats.
Attorney General James states that despite assurances of financial prosperity, investors never received the promised profits. An investigation conducted by the Office of the Attorney General revealed that between 2019 and 2023, investors deposited over a billion dollars worth of cryptocurrency into NovaTech. Shockingly, only a fraction, less than $26 million, was actually traded on NovaTech’s cryptocurrency trading platform during this period.
In her statement, Attorney General James emphasized the consequences of such activities on vulnerable communities. “Thousands of New Yorkers were falsely promised better lives if they simply trusted NovaTech and AWS Mining with their money, but it was all a lie,” she stated. “These cryptocurrency companies targeted immigrant and religious communities with promises of financial freedom but instead stole their money and drained their life savings.”
The lawsuit alleges that AWS Mining operated a deceptive scheme, promising investors monthly returns ranging from 15 to 20 percent and extravagant bonuses for recruiting new investors. However, the company failed to generate sufficient returns to fulfill these promises, resulting in losses for investors when it collapsed in 2019.
Lawsuit Seeks Prohibition and Compensation
The legal action seeks to prohibit AWS Mining, NovaTech, and their founders from conducting any business related to securities or commodities in New York. James also pursues disgorgement and damages to compensate the victims.
Following the collapse of AWS Mining, Cynthia and Eddy Petion launched NovaTechFx, and continued their fraudulent activities by enticing new investors with similar promises of high returns and recruitment bonuses.
Renold Julien, Executive Director of Konbit Neg Lakay, emphasized the importance of protecting vulnerable communities from exploitation. “Most Haitians in the Hudson Valley have walked weeks, months through the jungles of Central American countries to come to America looking for a better future for themselves and their family members,” he stated. “I thank Attorney General James for taking this action to protect all New Yorkers.”