NovaTech: The $1.37 Billion Pyramid
Published October 23, 2026
On October 23, 2026, New York Attorney General Letitia James asked a court to order the founders of collapsed crypto platform NovaTech, Cynthia and Eddy Petion, to pay $1.37 billion. The filing says investors deposited $1.16 billion while only about $26 million ever reached a trading provider — the rest, prosecutors say, funded payouts and the founders themselves.
New York Attorney General Letitia James is seeking nearly $1.37 billion from Cynthia and Eddy Petion, the founders of the defunct crypto and forex trading platform NovaTech, and their related companies. According to a court filing on October 22, 2026, reported by The Block, the state is asking for about $1.13 billion in disgorgement — the return of investor funds — plus $232.5 million in prejudgment interest. The court had already found the Petions and their companies liable by default in August 2025, after they failed to respond to the lawsuit; the new motion is about how much they should pay. The couple, the attorney general's office says, has since fled the country.
The numbers in the filing tell the story of what NovaTech actually was. Between August 2019 and May 2023, investors deposited about $1.16 billion worth of cryptocurrency into NovaTech's wallets, according to CoinPayments transaction records cited in the filing. At least $134.5 million in withdrawals went to wallets belonging to the founders themselves, with Cynthia Petion authorizing the transfers. By contrast, NovaTech deposited just $25.99 million with its trading provider, B2Broker, and traders lost $18.19 million of even that amount. Prosecutors say the platform paid purported trading profits and recruitment bonuses using money from new investors rather than legitimate trading gains — the textbook definition of a pyramid scheme.
The victims were not speculators chasing meme coins. The attorney general's office says more than 11,000 New Yorkers lost tens of millions of dollars through NovaTech and an earlier crypto mining scheme, AWS Mining, and that promoters targeted Haitian and other immigrant communities through prayer groups, social media and WhatsApp, promising high returns and recruitment bonuses. NovaTech collapsed in 2023, leaving tens of thousands of investors unable to withdraw their funds; AWS Mining had collapsed in 2019. James sued NovaTech, AWS Mining and associated companies in June 2024, and the motion separately seeks about $6.15 million over AWS Mining.
"NovaTech and AWS Mining scammed thousands of vulnerable New Yorkers by telling them they were making a safe investment when in reality, they were victims of a pyramid scheme," James said in a statement. "These scammers targeted immigrant and religious communities with the promise of a better life but instead robbed them of their life savings." Separately, four people who recruited investors into NovaTech have agreed to pay nearly $6 million in settlements intended to benefit victims and have been permanently barred from the securities, commodities and cryptocurrency industries.
Whether victims will see much of the $1.37 billion is another matter entirely. The founders have fled the country, and converting a court judgment into actual recovered money across borders is a long and uncertain process. For now, the case stands as one of the largest crypto-fraud enforcement actions by a state attorney general — and as a ledger of how little of the $1.16 billion was ever invested at all: roughly two cents on the dollar reached a trading desk, and even that lost money. Everything else was movement, not investment.
The one-line lesson writes itself, but it's worth saying plainly for anyone still getting the pitch: if the profits are paid out of the deposits of the people who joined after you, there is no trading strategy, no algorithm and no safety. There is only a queue. And queues always end.
The lesson: When the returns come from new investors instead of real trades, there is no investment — just a queue, and the queue always ends.
Source: original reporting · How we source stories