The SEC Files Lawsuit Against Crypto Pyramid Scheme NovaTech

The SEC yesterday filed a lawsuit against NovaTech, a cryptocurrency company, and its co-founders Cynthia and Eddy Petion.

The SEC alleges that the defendants fraudulently raised over $650 million from more than 200,000 investors worldwide, including many Haitian-Americans.

The co-founders allegedly promised investors that their money would be safe and that they would see profits from the very beginning.

However, instead of fulfilling their promises, the Petions reportedly used the new investments to repay earlier investors and pay commissions to promoters, while also stealing millions of dollars for themselves. This fraudulent scheme lasted for four years until NovaTech’s collapse in May 2023.

The lawsuit, filed in a Miami federal court, comes two months after New York Attorney General Letitia James also sued NovaTech and the Petions in a state court in Manhattan, alleging a fraud of over $1 billion.