NY Seeks $1.37 Billion Judgment Against Operators of NovaTech Crypto Ponzi Scheme
New York Attorney General Letitia James is pursuing a $1.37 billion judgment against the operators of NovaTech and AWS Mining, two crypto ponzi schemes that allegedly defrauded investors of over $1 billion.
Intelligence analysis by Gemini 2.5 Flash
The schemes, NovaTech and its predecessor AWS Mining, targeted immigrant and religious communities with promises of high returns on crypto investments. Prosecutors allege the returns were fabricated, with new investor funds used to pay earlier ones, while the founders, Cynthia and Eddy Petion, allegedly fled the country.
Imagine someone promised to make your allowance money grow super fast by investing in a special digital piggy bank. But instead of actually growing it, they just used new kids' allowance to pay older kids, and then ran away with a lot of the money themselves. That's what happened with NovaTech and AWS Mining, but with digital money called crypto, and now the grown-ups in New York are trying to get back over a billion dollars for the people who lost their savings.
Analysis
The New York Attorney General's office is taking aggressive action against the alleged operators of two successive cryptocurrency investment schemes, NovaTech and AWS Mining, seeking a substantial $1.37 billion judgment. These schemes are accused of defrauding hundreds of thousands of investors globally, primarily by targeting immigrant and religious communities through various outreach methods including prayer groups and WhatsApp chats. The scale of the alleged fraud, exceeding $1 billion, underscores the significant financial damage inflicted upon victims who were promised unrealistic returns.
NovaTech and AWS Mining
AWS Mining, the initial scheme, promised monthly returns of 15 to 20 percent and a 200 percent return within 15 months on crypto mining contracts before its collapse in 2019. Following this, the alleged founders launched NovaTech, marketing it as a registered hedge fund broker that offered weekly trading returns of two to four percent, equating to over 140 percent annually. These promised returns were reportedly fabricated, with records from B2Broker, the platform provider, indicating that out of more than $1 billion deposited by investors, only about $26 million was actually traded. Furthermore, NovaTech's traders lost $18.2 million of the funds that were traded, confirming the ponzi structure where earlier investors were paid with money from newer deposits.
The Petions
Cynthia and Eddy Petion, identified as the alleged founders and operators of both NovaTech and AWS Mining, are central to the legal action. According to the AG's office, the Petions never appeared in court and have reportedly fled the country, complicating efforts to recover funds. The Attorney General is specifically seeking $134.5 million that the Petions allegedly withdrew to their personal wallets from an investor account solely controlled by Cynthia Petion, in addition to $4.7 million linked to the earlier AWS Mining scheme. A default judgment issued in August 2025 already prohibits the couple and their associated companies from participating in the securities, commodities, and cryptocurrency industries.
B2Broker
B2Broker played a role in the NovaTech scheme by supplying its white-label trading platform. The records obtained from B2Broker were crucial in exposing the fraudulent nature of NovaTech's operations. These records demonstrated the vast discrepancy between the funds deposited by investors and the minimal amount actually engaged in trading activities. The data from B2Broker provided concrete evidence that the promised returns were not generated through legitimate trading but rather through a classic ponzi structure, where new investor money was used to pay off earlier investors, until the scheme inevitably collapsed in mid-2023, leaving tens of thousands unable to withdraw their funds.
Key points
- New York AG seeks $1.37 billion judgment against NovaTech and AWS Mining operators for crypto ponzi schemes.
- The schemes allegedly defrauded hundreds of thousands of investors worldwide out of over $1 billion.
- Founders Cynthia and Eddy Petion reportedly fled the country after targeting immigrant and religious communities.
- Only $26 million of over $1 billion deposited was actually traded, with $18.2 million of that lost.
- A default judgment already bars the Petions and their companies from the securities, commodities, and cryptocurrency industries.
The aggressive legal action by the New York Attorney General could set a strong precedent, deterring future large-scale crypto ponzi schemes and potentially leading to some recovery of funds for the defrauded victims. This enforcement demonstrates a commitment to protecting consumers in the evolving digital asset landscape.
Despite the substantial judgment sought, the fact that the alleged operators have fled the country presents a significant challenge to the full recovery of the $1.37 billion. This situation highlights the difficulties in enforcing judgments and retrieving assets in cross-border crypto fraud cases, leaving many victims with little hope of recouping their losses.
