New York is seeking about $1.37 billion from Novatech founders Cynthia and Eddy Petion after a court entered a default judgment in a crypto fraud case. State filings show investors deposited more than $1.16 billion, while only about $26 million was sent to the platform used for trading.
Default Judgment and $1.37 Billion Request
Attorney General Letitia James has asked a state court to order the Novatech founders to pay $1.367 billion, including roughly $1.135 billion in disgorgement and $232.5 million in prejudgment interest. The request follows an August 2025 default judgment after the defendants failed to appear; the attorney general’s office says the couple fled the country.
The case centers on Novatech, which prosecutors say promised investors weekly crypto trading returns of roughly 2% to 4% while using incoming deposits to fund withdrawals and recruitment rewards.
$1.16 Billion Came In, Only $26 Million Reached Trading
Investors sent $1.1605 billion in cryptocurrency to Novatech’s Coinpayments wallet between August 2019 and May 2023, according to court documents. Yet just $25.99 million was deposited with B2Broker for trading. Novatech’s traders lost about $18.19 million of that amount.
New York says those figures undercut Novatech’s claims that investor returns were generated through successful crypto and forex trading.
Founders’ Wallets and Investor Outreach
The filing also alleges Cynthia Petion authorized at least $134.5 million in cryptocurrency withdrawals from Novatech’s Coinpayments account to wallets belonging to herself and Eddy Petion.
The state argues that Novatech generated no legitimate trading profits sufficient to fund its promised returns. Instead, prosecutors say payouts came from money deposited by other investors.
More than 11,000 New Yorkers invested in Novatech and the earlier AWS mining operation, with Haitian and other immigrant communities specifically targeted through prayer groups, social media, and WhatsApp chats, according to the state.
Four Promoters Agree to Nearly $6 Million
New York has separately reached settlements with four top promoters. Martin Zizi, Frantz Ciceron, Ricardo Roy Sr, and James Corbett agreed to pay nearly $6 million combined and accepted permanent bans from the securities, commodities, and cryptocurrency industries.
The $1.37 billion request against the Petions is larger by orders of magnitude. For the crypto industry, the case is a reminder that enormous onchain deposit totals can conceal remarkably little genuine investment activity. Prosecutors say more than a billion dollars entered the system while only a tiny fraction ever reached the trading operation investors were told would generate their returns.
