New York Attorney General Letitia James is asking a state court to impose nearly $1.37 billion in financial relief against Cynthia and Eddy Petion, the founders of collapsed crypto investment platform NovaTech, as four promoters of the alleged pyramid scheme separately agree to surrender almost $6 million and leave the securities, commodities and cryptocurrency businesses.
The October 22 developments bring a large investor-fraud case into a new phase: liability findings and negotiated settlements now exist for different defendants, but the amount ultimately collectible from the founders—and the money actually returned to victims—remain separate, unresolved questions. The state says NovaTech drew more than $1 billion in cryptocurrency deposits while comparatively little capital reached its trading provider.
According to a court filing described in October 23 reporting, CoinPayments transaction records put investor crypto deposits at approximately $1.16 billion. Prosecutors traced at least $134.5 million in withdrawals to wallets attributed to the founders and identified approximately $25.99 million sent to trading-service provider B2Broker, where they allege about $18.19 million in trading losses. These are the state’s financial allegations, not independently audited final recovery amounts.
Why Is New York Seeking Nearly $1.37 Billion From NovaTech’s Founders?
The attorney general’s October 22 announcement says prosecutors have asked the court to order Cynthia and Eddy Petion to pay approximately $1.3 billion in financial relief after the couple failed to respond to the state’s litigation. The latest reported court affirmation breaks the request into roughly $1.13 billion in disgorgement and $232.5 million in prejudgment interest.
Adding those rounded components produces about $1.36 billion, widely described as nearly $1.37 billion. The specific dollar amount requested should not be confused with money already paid, cash held by authorities or a final award whose exact monetary terms have been entered and collected.
The New York Supreme Court issued a default judgment against the Petions in August 2025, according to the state. A default judgment follows a defendant’s failure to defend a lawsuit; the subsequent determination of monetary relief is a further judicial step. The attorney general says the founders have left the country. Their reported absence raises obvious questions about locating and enforcing against assets, although it does not establish that the state will recover nothing.
Disgorgement generally seeks to strip unlawful gains or proceeds under the relevant legal framework. Prejudgment interest is a separate component intended to account for the time before the court awards money. Neither category means every individual investor will automatically receive the same proportion of their deposits back.
The New York enforcement action is distinct from federal proceedings filed by the Securities and Exchange Commission. The SEC’s original case concerned NovaTech, the founders and several promoters, while the latest state request addresses specific defendants and relief under New York law.
How Did $1.16 Billion in Deposits Compare With Actual Trading?
The financial comparison is the most revealing part of the state’s latest account. Prosecutors say the payment processor CoinPayments handled approximately $1.16 billion in cryptocurrency deposits to NovaTech wallets. Of the funds traced, about $25.99 million reportedly went to B2Broker between August 2019 and April 2023, and trades associated with that balance allegedly lost $18.19 million.
| Amount in the latest reported filing | Figure | Interpretation |
|---|---|---|
| Investor crypto deposits | About $1.16 billion | Gross incoming value, not verified net investor losses |
| Transfers to wallets attributed to founders | At least $134.5 million | Investigator attribution; not necessarily funds personally spent |
| Money sent to B2Broker | $25.99 million | Funds routed to a trading provider, not total trading turnover |
| Trading losses attributed to those funds | $18.19 million | About 70% of money sent to the provider |
| Relief sought from founders | Nearly $1.37 billion | Court request, not a completed recovery |
On those figures, the amount deposited with the trading provider equals just 2.24% of the reported gross inflows. Around 70% of that $25.99 million was reportedly lost through trading. Those are derived ratios, not a calculation of NovaTech’s overall investment performance or a definitive estimate of how much money remains recoverable.
The prosecutor’s evidence also indicates that bonuses and purported investment returns were paid primarily from fresh investor contributions rather than profits generated by the promised trading strategy. The allegation describes a Ponzi mechanism layered over a recruitment-based pyramid: account balances and periodic returns could appear consistent while new money was being used to satisfy older obligations.
Identifying B2Broker as the trading-service provider does not allege that B2Broker participated in NovaTech’s suspected deception or misappropriation. The firm appears in the described records as the venue or provider through which a relatively small part of the deposits was routed.
Likewise, $134.5 million in reported transfers to founder-linked wallets does not establish that every dollar was retained by the Petions or is still available. Wallet attribution, ultimate beneficial ownership and subsequent spending require distinct evidentiary steps.
Which Four Promoters Agreed to Pay Almost $6 Million?
Unlike the founders’ requested monetary judgment, the agreements with four promoters have been announced as settlements. New York says Martin Zizi, Frantz Ciceron, Ricardo Roy Sr. and James Corbett will pay a combined $5,975,861 in disgorgement for the benefit of victims.
| Promoter | Agreed payment |
|---|---|
| Martin Zizi | $2,900,000 |
| Frantz Ciceron | $2,050,000 |
| James Corbett | $750,000 |
| Ricardo Roy Sr. | $275,861 |
| Total | $5,975,861 |
The four have also agreed to permanent industry bans covering securities, commodities and cryptocurrency activity under the terms described by the attorney general. The claims being resolved include alleged misleading statements, unregistered brokerage activity and participation in illegal pyramid operations connected with NovaTech and its predecessor, AWS Mining.
A settlement obligation is not the same as confirmation that nearly $6 million has already been distributed to investors. The state described the payments as amounts the promoters will pay, and it has not provided in its October 22 announcement a complete timetable for victim distributions or an individual claims process.
Even if every dollar under these settlements becomes available for compensation, the amount would be small next to more than $1 billion in gross deposits. Comparing $5.98 million with $1.16 billion yields roughly 0.52%; that is a scale illustration, not the percentage of actual victim losses already recovered, because gross deposits and proven losses are different measurements.
A comparable distinction arose when a court ordered $31.5 million in sanctions and restitution in the Fundsz case. A legal obligation may be considerably larger than the property authorities can ultimately seize and return.
How Did NovaTech and AWS Mining Recruit Investors?
According to the attorney general’s June 2024 complaint announcement, the Petions previously promoted AWS Mining, an investment program promising 15% to 20% monthly returns and recruitment bonuses. It collapsed in 2019. They then built NovaTech, marketing supposed cryptocurrency and foreign-exchange trading with profits commonly advertised at approximately 2% to 4% a week.
The sales effort concentrated on communities whose members already knew and trusted one another. The state describes recruitment through prayer groups, WhatsApp chats, social media, Haitian Creole promotional material and religious messaging. More than 11,000 New Yorkers were affected, including residents of New York City, Long Island, Westchester, Rockland and Orange counties.
New York alleges the companies falsely portrayed themselves as properly licensed investment businesses and exaggerated their ability to generate trading returns. Recruitment commissions helped the schemes spread because an existing participant could benefit from persuading friends or relatives to contribute.
Trust-based recruitment is not itself proof of a pyramid scheme. The concern arises when promoters claim that returns derive from productive investments while payments depend substantially on the continued arrival of new money. Unusually steady weekly gains, high referral incentives and barriers to withdrawals can make that dependence harder for participants to recognize until cash flow stops.
The SEC’s August 2024 complaint announcement described more than 200,000 investors and over $650 million in crypto assets raised by NovaTech. That earlier federal figure should not be added to the $1.16 billion now reported in the New York court filing: the measurements come from separate investigations and evidentiary records that overlap.
Why Doesn’t the $1.37 Billion Request Mean Victims Will Recover It?
Recovering losses from a collapsed investment scheme generally takes more than proving that the operators made unlawful promises. Authorities must identify assets still held by defendants or intermediaries, secure legally enforceable orders, overcome possible competing claims and establish how proceeds should be allocated.
Crypto transaction histories can help investigators follow funds between wallets and payment processors, but even correctly attributed transfers can lead to accounts that no longer hold the original value. Transfers to exchanges, spending over several years and assets held across borders complicate collection.
Nor are reported gross deposits the same as total victim losses. Some early participants may have received withdrawals, while the economic value of different digital assets changes with the valuation method and date used. A proper restitution calculation must avoid counting recycled payments as new independent losses and account for individual transactions.
The founder-linked transfers and B2Broker trading data offer the state a picture of how funds moved, but neither figure alone establishes precisely how much victims can recover. An investor should not treat the nearly $1.37 billion requested from the founders and the $5.98 million of promoter settlements as a combined pool already held for distribution.
The recovery distinction also matters in broader enforcement. DaveFinances previously examined how restricting suspected scam proceeds differs from returning funds to victims; the same principle applies to court judgments, even though NovaTech is a separate historical investment-fraud case.
What Should NovaTech Investors Watch Next?
The immediate legal event to monitor is the New York court’s decision on the amount and structure of relief sought from the Petions. The state has described the default judgment against them, but the October 22 filing represents a request for specific financial remedies, not confirmation that the full amount has been collected.
Victims also need verified information on whether the promoter settlement money has been received, who administers distributions, whether a formal claims process will open and how payments interact with other civil or federal actions. No universal payout date or confirmed recovery percentage was established in the latest announcement.
Scam victims can also be targeted again by impostors promising immediate reimbursement for an advance fee. DaveFinances’ wallet-security guide describes suspicious requests for signatures and funds; NovaTech’s alleged model was different, involving a purported investment manager and recruitment incentives, but the lesson about independently verifying counterparties and payment instructions remains relevant.
The October 22 case update therefore delivers two different outcomes. Four promoters have accepted substantial financial obligations and permanent industry restrictions. Prosecutors are separately trying to convert the earlier default judgment against NovaTech’s founders into a much larger monetary order. The contrast between $1.16 billion in alleged investor deposits and $25.99 million routed to a trading provider explains why the state characterizes the enterprise as a fraudulent investment program rather than a trading strategy that merely performed badly. How much victims can actually recover remains unanswered.
Johan Shamshad is a financial markets writer at Dave Finances covering cryptocurrencies, trading platforms, brokers, fintech, financial regulation, and developments across global markets. He previously worked at Gulf News, adding newsroom experience to his coverage of fast-moving financial and digital-asset markets.
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