New York Attorney General Letitia James filed a lawsuit claiming hundreds of thousands.
New York Attorney General Letitia James has filed a lawsuit alleging that hundreds of thousands of people lost more than $1 billion to two cryptocurrency companies with overlapping founders. The lawsuit names as defendants cryptocurrency trading company NovaTech, its founders Cynthia and Eddy Petion, defunct cryptocurrency mining company AWS Mining, and individuals and companies associated with it.
According to the lawsuit, more than 11,000 New York State residents, including members of New York’s Haitian community, lost tens of millions of dollars by investing in NovaTech. The lawsuit alleges that NovaTech is a Ponzi scheme that uses religious appeals to attract customers.
The lawsuit alleges that NovaTech also misrepresented its licensing and registration status. The company was registered in Saint Vincent and the Grenadines until its cancellation by that country’s Financial Services Authority in January 2023. The company collapsed in May 2023.
Fraudulent activity alleged earlier
Before founding NovaTech, the Petions family was among the founders of AWS Mining, which closed in 2019. This company was also allegedly a Ponzi scheme, but was unable to generate enough revenue to provide the promised returns.
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The lawsuit alleges that more than $1 billion in cryptocurrencies were deposited into the company between its inception in 2019 and 2023, but only $26 million was traded. James is seeking damages and preventing AWS Mining, NovaTech and Petitions from doing business in New York. James said in a statement:
“We see the real dangers of unregulated cryptocurrency platforms with projects like this, but New Yorkers can rest assured that we will use the tools at our disposal to take down cryptocurrency fraudsters.”
Other Potential Fraudulent Communications
The NovaTech website is active at the time of writing. Cynthia Petion says the company’s money was lost following a data breach and the company is in the process of getting it back. Judging by the documents available on X, the company began claiming to have been hacked in May 2023.
A South African company called NovaTech, which used the same logo as Petions and displayed an image of Cynthia Petion on its Facebook page, was active in 2022 and 2023.
The Texas State Securities Board issued a cease and desist order in 2018 against a cryptocurrency company called AWS Mining, accused of using methods similar to those of the company involved in the petitions, but the petitions did not been mentioned in this action.
Magazine: New York sues crypto companies, FTX’s Nishad faces 75 years in prison, Grayscale’s new BTC repository: Hodler’s Digest, October 15-21
