New York Legal professional Basic Letitia James has filed a swimsuit alleging that lots of of hundreds of individuals misplaced over $1 billion to 2 crypto companies with overlapping founders. The swimsuit names cryptocurrency buying and selling firm NovaTech, its founders Cynthia and Eddy Petion, defunct cryptocurrency mining firm AWS Mining and related people and corporations as defendants.
In accordance with the suit, greater than 11,000 New York state residents, notably members of the New York Haitian group, misplaced tens of hundreds of thousands of {dollars} by investing in NovaTech. The swimsuit alleges that NovaTech is a Ponzi scheme that has used non secular appeals to draw clients.
NovaTech additionally misrepresented its licensing and registration standing, the swimsuit alleges. The corporate was registered in St. Vincent and the Grenadines till that nation’s Monetary Providers Authority canceled it in January 2023. The corporate collapsed in Might 2023.
Earlier fraudulent exercise alleged
Earlier than founding NovaTech, the Petions have been among the many founders of AWS Mining, which closed in 2019. Allegedly, that firm was additionally a Ponzi scheme however was unable to generate sufficient revenue to supply the returns it promised.
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Over $1 billion in cryptocurrency was deposited within the firm between its founding in 2019 and 2023, however solely $26 million was traded, the swimsuit alleges. James is looking for disgorgement and damages and to ban AWS Mining, NovaTech and the Petions from doing enterprise in New York. James said in an announcement:
“We’re seeing the true risks of unregulated cryptocurrency platforms with schemes like these, however New Yorkers can relaxation assured that we’ll use the instruments at our disposal to crack down on crypto fraudsters.”
Different potential fraudulent connections
The NovaTech web site is energetic on the time of writing. On it, Cynthia Petion claims that the corporate’s funds have been misplaced in a knowledge breach, and the corporate is within the means of recovering them. Judging from materials out there on X, the corporate began claiming it was hacked in Might 2023.
An organization in South Africa referred to as NovaTech, which used the identical emblem because the Petions’ firm and displayed Cynthia Petion’s image on its Fb web page, was active in 2022 and 2023.
The Texas State Securities Board issued a cease-and-desist order in 2018 towards a crypto firm referred to as AWS Mining that was accused of working ways much like the corporate the Petions have been concerned in, however the Petions weren’t talked about in that motion.
