Once one of the fastest growing financial platforms on the market, the New York Attorney General now says NovaTechFx is nothing more than a front for a billion-dollar pyramid scheme.
New York Attorney General Letitia James filed a lawsuit this week in New York State Supreme Court against the company and its founders, Cynthia and Eddie Petione.
The lawsuit accuses Petions of defrauding thousands of investors around the world and “earning more than $1 billion by promoting two successive fraudulent investment schemes.” The lawsuit also names AWS Mining Pty Ltd, a cryptocurrency mining platform formerly operated by Petions, as a defendant.
In 2022, NovaTechFx was one of the fastest growing online financial services in terms of internet traffic: the company's website attracted 12.4 million visits that year, an increase of 518% compared to the previous year.
According to the complaint, NovaTechFx falsely promoted itself as a “registered hedge fund broker” and falsely claimed to be licensed to trade cryptocurrencies around the world.
The lawsuit alleges that the couple targeted Haitian immigrants in New York City, using local prayer circles to recruit them into a pyramid scheme.
According to the lawsuit, after Cynthia Petion founded NovaTechFx in 2019, she rebranded herself as “Pastor CEO” and claimed the company was “God's vision.”
But in private messages, she described herself as a “zookeeper” and the investors as a “cult,” according to the lawsuit.
“People join and follow unconsciously… They're not thinking, they just agree with everything you say,” Petition said in one of the messages, according to the lawsuit.
According to the lawsuit, NovaTechFx employees created flyers advertising prayer meetings hosted by the company with slogans such as, “A team that prays together stays united and grows together.”
According to court documents, the petitioners also operate the NovaTechFx website, which the complaint says investors go to to invest in cryptocurrencies through the company.
According to court documents, after receiving payments that investors intended to use for trades, NovaTechFx transferred the funds to “payment processors who did not trade the cryptocurrency for NovaTech but simply stored it in NovaTech's wallets.”
Of the more than $1 billion deposited through the website between 2019 and 2023, NovaTechFx actually traded only about $26 million, according to the attorney general's office.
“Thousands of New Yorkers were falsely promised a better life if they put their money with Novatec and AWS Mining, but it was all a lie,” James said in a statement. “These cryptocurrency companies targeted immigrant and religious communities, promising them financial freedom but in reality stealing their money and depleting their life's savings.”
Reynold Julien, executive director of local Haitian nonprofit Combit Neg Lacay, said in a statement that most Haitian migrants come to the U.S. to escape violence and should not be taken advantage of.
“I thank Attorney General James for taking this action to protect all New Yorkers. Komvit Neg Rakai seeks full compensation,” he said.
Since the lawsuit was filed, NovaTechFx's website has featured a message from Cynthia Persson saying the company had experienced a “data breach” and had temporarily shut down the site.
“We are pleased to inform you that we have successfully recovered 86% of the official data from the trading platform,” the message read. “All accounts have been merged to a new domain to enable withdrawals. To regain full access, please log in using your exact details on the website.”
NovaTechFx did not immediately respond to Business Insider's request for comment.