English
Arabic
Chinese (Simplified)
Indonesian
Russian
By Jonathan Stempel
NEW YORK (Reuters) – The U.S. Securities and Trade Fee on Monday sued the cryptocurrency firm NovaTech and its married co-founders, saying they fraudulently raised over $650 million from greater than 200,000 traders worldwide, together with many Haitian-Individuals.
NovaTech and co-founders Cynthia and Eddy Petion allegedly promised traders their cash can be protected, with Cynthia Petion assuring they’d be “in revenue from day one.”
The SEC mentioned the Petions as a substitute used new cash primarily to repay earlier traders and pay commissions to promoters, whereas siphoning thousands and thousands of {dollars} for themselves. It mentioned the scheme lasted for 4 years till NovaTech’s Might 2023 collapse.
Monday’s lawsuit in Miami federal court docket got here two months after New York Lawyer Normal Letitia James sued NovaTech and the Petions in a state court docket in Manhattan, estimating their fraud at greater than $1 billion.
The regulators mentioned NovaTech tried to attraction to victims’ spiritual religion by means of social media, Telegram and WhatsApp, and typically within the Haitian Creole language, with Cynthia Petion branding herself “Reverend CEO” and saying NovaTech was “God’s imaginative and prescient.”
Attorneys for NovaTech and the Petions, who’re believed to reside in Panama, couldn’t instantly be recognized.
Each regulators referred to as the fraud a pyramid scheme, the place corporations pay bonuses or commissions to recruit new traders.
The SEC additionally charged six NovaTech promoters with fraud, saying they saved recruiting traders regardless of “pink flags,” comparable to delayed withdrawals and U.S. and Canadian regulatory actions, that raised questions on NovaTech’s legitimacy.
One promoter, Martin Zizi, agreed to pay a $100,000 civil advantageous. His lawyer didn’t instantly reply to a request for remark.
Each lawsuits search restitution for victims and civil fines.
The case is SEC v Nova Tech Ltd, U.S. District Courtroom, Southern District of Florida, No. 24-23058.