New York Pursues $1.37 Billion NovaTech Recovery After Default Ruling
By Coinvote
New York Attorney General Letitia James is seeking $1.37 billion from NovaTech’s founders and related companies after a default liability ruling. Separate promoter settlements offer another recovery avenue, while enforcement and the distribution of recovered money remain unresolved.
A payment request follows an existing liability ruling
New York is asking a court to impose a $1.37 billion financial judgment against Cynthia and Eddy Petion and companies connected to NovaTech. According to Decrypt, the attorney general’s filing seeks damages, disgorgement and interest following the collapse of a platform marketed as a crypto trading business.
The request is not a newly awarded payment order. Cointelegraph reported that the court established liability by default in August 2025 after the defendants failed to answer the lawsuit. Decrypt reported that the earlier judgment also excluded the Petions from securities, commodities and crypto businesses.
James separately announced agreements with four leading promoters to pay nearly $6 million for victims, according to Decrypt. Those settlements are distinct from the larger financial judgment now being sought against the founders and associated companies.
Deposits far exceeded the money sent for trading
The central financial allegation concerns the gap between what investors deposited and what NovaTech committed to trading. Decrypt reported that CoinPayments records showed roughly $1.16 billion entering NovaTech’s wallet between August 2019 and May 2023, with Cynthia Petion its sole authorized account user.
According to Bitcoin Magazine, records from trading-platform provider B2Broker showed that only about $26 million reached trading operations. The outlet reported trading losses of $18.2 million. Prosecutors said payments presented as returns instead depended on incoming investor money.
That distinction matters more than the advertised performance. In a trading business, returns depend on investment results. A structure that uses fresh deposits to meet earlier payout commitments relies instead on continuing inflows, leaving withdrawal promises exposed when that funding stops.
- Decrypt reported roughly $1.16 billion in crypto deposits during the period covered by the payment records.
- Cointelegraph reported a request for about $1.13 billion in investor funds and $232.5 million in interest.
- Decrypt reported that at least $134.5 million moved to wallets belonging to the Petions.
An earlier mining scheme preceded NovaTech
NovaTech followed AWS Mining, where the Petions had been leading American promoters, according to Decrypt. AWS Mining offered purported crypto-mining returns of 15% to 20% monthly before its collapse in 2019. Bitcoin Magazine reported that NovaTech subsequently promoted weekly trading returns of 2% to 4%.
The alleged recruitment methods also form a significant part of the state’s account. Decrypt reported that promoters reached immigrant communities, particularly Haitian New Yorkers, through prayer groups, WhatsApp and social media. Haitian Creole advertising and religious messaging featured in that outreach, according to the attorney general.
Cointelegraph reported that more than 11,000 New Yorkers suffered losses across NovaTech and AWS Mining. NovaTech’s collapse in 2023 left tens of thousands of investors unable to access their money, and James brought the lawsuit in June 2024.
Reports agree on the core claim but add different detail
The outlets describe the same broad enforcement action, but their financial detail is not identical. Cointelegraph puts the requested interest at $232.5 million, while Decrypt reports $232 million. Both describe roughly $1.13 billion sought in connection with investor funds, alongside the headline $1.37 billion request.
The AWS Mining amounts also require careful labeling. Bitcoin Magazine reports $4.7 million tied to that earlier scheme, while Cointelegraph describes a separate request of about $6.15 million that includes interest. Those descriptions should not be treated as interchangeable measures.
The Block emphasizes the founders’ departure from the United States and the contrast between $1.16 billion received and the limited amount traded. Decrypt adds payment-processor records and alleged transfers to the founders’ wallets. Bitcoin Magazine contributes the trading-loss figure, while Cointelegraph highlights unanswered questions about enforcement and victim distributions.
Account records matter more than advertised returns
For crypto holders and project teams assessing investment-platform claims, the case illustrates why a displayed return is not evidence of profitable trading. According to Decrypt, the state alleges that both weekly payouts and recruitment bonuses were financed through new deposits rather than investment gains.
The alleged licensing claims are another important distinction. Decrypt reported that NovaTech falsely presented itself as a registered hedge fund broker with authorization to trade crypto in the United States. Registration claims, control over customer accounts and records of actual trading are separate issues, even when promotional material presents them together.
The promoter settlements also extend the case beyond the founders. Decrypt identifies Martin Zizi, Frantz Ciceron, Ricardo Roy Sr. and James Corbett as the settling promoters, who accepted permanent industry exclusions. Their agreements demonstrate that the recovery effort includes people involved in attracting investors, not only those operating the platform.
Recovery depends on enforcement and distribution
The next substantive development is the court’s decision on the requested financial relief. A liability ruling establishes responsibility, but a financial award and the collection of assets are separate stages. Decrypt reported that the Petions had fled the country, according to James.
Cointelegraph asked the attorney general’s office how recovered assets would reach victims and how a judgment could be enforced, but received no response before publication. Those are the key unresolved issues for investors: the amount ultimately recovered, the mechanism for distributing it and how the promoter settlements fit into that process.
Market snapshot
| Asset | Price | 24h | 7d | Market cap |
|---|---|---|---|---|
| Bitcoin (BTC) | $80,806 | -1.0% | -1.0% | $1.62 trillion |
CoinGecko data as of 2026-10-24 (UTC).
FAQ
Has New York already secured a $1.37 billion NovaTech payment order?
The reports describe a request for that financial judgment, not a completed award. The court previously established liability by default in August 2025 after the defendants failed to respond.
How much NovaTech investor money went toward trading?
The outlets report that about $26 million reached the trading provider, compared with roughly $1.16 billion in deposits. Bitcoin Magazine reported that trading lost $18.2 million.
Will NovaTech victims receive the promoter settlement money?
The nearly $6 million in promoter settlements is intended to benefit victims, according to the reports. Cointelegraph reported that questions about distribution arrangements remained unanswered at publication.
Sources
- Bitcoin Magazine: NY Seeks $1.37 Billion Judgment Against Operators of NovaTech Crypto Ponzi Scheme (2026-10-23)
- Decrypt: Crypto Scammers Who Used Prayer Groups to Lure Victims Must Pay $1.3 Billion, Says New York (2026-10-23)
- Cointelegraph: New York AG seeks $1.37B from NovaTech founders over Ponzi scheme (2026-10-23)
- The Block: New York seeks over $1.3 billion from NovaTech founders after couple fled the US (2026-10-23)
- CoinGecko (market data)
Written by the Coinvote news desk from reporting by Bitcoin Magazine, Decrypt, Cointelegraph and The Block. Not financial advice.
