The Attorney General of New York, Letitia James, has launched a lawsuit against two crypto companies, AWS Mining and NovaTech, claiming that they caused over $1 billion in losses to hundreds of thousands of investors. The lawsuit alleges that the founders of both companies, Cynthia and Eddy Petion, overlapped and engaged in fraudulent activities that led to significant financial harm to investors.
According to the lawsuit, NovaTech misrepresented its registration and licensing status, drawing in over 11,000 investors in New York State, particularly from the Haitian community. The lawsuit claims that NovaTech operated as a Ponzi scam, using religious beliefs to attract participants. The company received over $1 billion in crypto deposits between 2019 and 2023, but only $26 million was actually traded.
The Petions were also involved in AWS Mining, which shut down in 2019 before starting NovaTech. Both companies are accused of engaging in fraudulent activities and failing to deliver on promised returns to investors. The lawsuit seeks to prohibit AWS Mining, NovaTech, and the Petions from conducting business in New York, as well as seeking disgorgement and damages.
Attorney General Letitia James stated, “We are seeing the real dangers of unregulated crypto platforms with schemes like these, but New Yorkers can rest assured that we will use the tools at our disposal to crack down on crypto fraudsters.” The lawsuit highlights the risks associated with unregulated crypto platforms and the importance of holding fraudulent actors accountable.
As of now, the NovaTech website is still operational, with Cynthia Petion claiming that a data breach resulted in the loss of company funds. The company is reportedly working to retrieve the lost funds. The lawsuit serves as a warning to investors to exercise caution when investing in crypto companies and to be aware of the risks associated with unregulated platforms.
