Bitcoin Magazine

NY Seeks $1.37 Billion Judgment Against Operators of NovaTech Crypto Ponzi Scheme

New York Attorney General Letitia James is trying to secure a $1.37 billion judgment against the operators of NovaTech and its predecessor AWS Mining, two successive cryptocurrency investment schemes that allegedly defrauded hundreds of thousands of investors worldwide out of more than $1 billion.

Alleged founders Cynthia and Eddy Petion never appeared in court and, according to the AG’s office, fled the country.

“NovaTech and AWS Mining scammed thousands of vulnerable New Yorkers by telling them they were making a safe investment when in reality, they were victims of a pyramid scheme,” James said in a statement. “These scammers targeted immigrant and religious communities with the promise of a better life but instead robbed them of their life savings.”

The schemes, AWS Mining and later NovaTech, relied on promoters who recruited heavily in Haitian and other immigrant communities — through prayer groups, WhatsApp chats, and ads in Haitian Creole.

AWS Mining sold crypto mining contracts promising 15 to 20 percent monthly returns and 200 percent within 15 months. It collapsed in 2019. The Petions then launched NovaTech, marketed as a registered hedge fund broker, promising weekly trading returns of two to four percent — more than 140 percent a year.

Those returns were fabricated, according to prosecutors. Records from B2Broker, which supplied NovaTech’s white-label trading platform, show that of the more than $1 billion investors deposited between 2019 and 2023, only about $26 million was ever actually traded — and NovaTech’s traders lost $18.2 million of that. Returns to earlier investors came from newer deposits, not trading. When NovaTech collapsed in mid-2023, tens of thousands of investors could not withdraw their funds.

The AG is also seeking $134.5 million the Petions allegedly withdrew to their own wallets from the investor account Cynthia Petion solely controlled, plus $4.7 million tied to the earlier AWS Mining scheme. A default judgment entered in August 2025 already bars the couple and their companies from the securities, commodities, and cryptocurrency industries.

Separately, four of the scheme’s top promoters have agreed to pay nearly $6 million in disgorgement to victims and accepted the same industry bans.

This post NY Seeks $1.37 Billion Judgment Against Operators of NovaTech Crypto Ponzi Scheme first appeared on Bitcoin Magazine and is written by Mathew Di Salvo.

Bitcoin Magazine

President Trump to Highlight Crackdown on Overseas Crypto Scams

President Donald Trump will use a White House event on Wednesday to spotlight his administration’s push against foreign criminal networks that lure Americans into fake crypto investments, a White House official told Reuters.

The remarks are part of a broader event on cyber crime prevention. Trump and members of his cabinet plan to point to the government’s seizure of fraudulent crypto investment websites and its work to shut down online impersonation scams, the official reportedly said.

Homeland Security Secretary Markwayne Mullin, FBI Director Kash Patel, Defense Secretary Pete Hegseth and Attorney General Todd Blanche are expected to attend.

The event follows a March executive order in which Trump directed the Justice Department to prioritize the identification and prosecution of online scammers. He followed that with a memo directing the Department of Homeland Security to work with private companies to surveil foreign criminal hacking groups.

Record losses in internet and crypto scams

The numbers behind the crackdown are grim. Americans filed more than one million complaints with the FBI about internet scams in 2025, a 17% increase from 2024, and reported record losses.

Crypto fraud accounted for more than half of that damage. The FBI’s Internet Crime Complaint Center logged 181,565 crypto-related complaints and $11.366 billion in losses for 2025, making digital assets the single most loss-heavy category in the report. Crypto investment scams drained $7.2 billion of that total.

The FBI traced much of the activity to organized criminal enterprises in Southeast Asia — in Cambodia, Laos and Burma — that use victims of human trafficking as forced labor inside scam compounds. Criminals make contact through text messages, social media, dating apps and digital ads before steering victims to fake platforms that display fabricated profits. When victims try to withdraw, scammers demand taxes and fees and vanish.

Americans aged 60 and older bore the heaviest burden, with $4.43 billion in crypto-related losses. Crypto ATM scams produced $389 million in losses, a 58% jump from 2024, and recovery scams that target prior victims generated another $1.4 billion.

The global picture is worse. Chainalysis data from January showed illicit crypto addresses received at least $154 billion in 2025, a 162% increase from 2024. North Korea-linked hackers stole $2 billion over the year, including the $1.5 billion Bybit exploit, the largest crypto heist on record.

Enforcement has produced some solid results. The FBI’s Operation Level Up notified 3,780 victims of active crypto investment fraud in 2025 and saved an estimated $225.8 million. A Scam Center Strike Force that combines the DOJ, FBI, Secret Service, State Department and Treasury’s OFAC targets the Southeast Asian compounds.

According to Reuters, Trump and his sons have added at least $2.3 billion to the family fortune from their main crypto ventures, while the investors they courted have absorbed a $2.3 billion hit. 

In October 2025, Trump pardoned Changpeng Zhao, the Binance founder convicted after the exchange pleaded guilty to failing to maintain an effective anti-money laundering program.

Democrats in Congress have accused the Trump family of using the presidency to enrich itself through its crypto ventures, a charge the White House rejects.

White House spokeswoman Anna Kelly said that “all actions by President Trump and his administration are taken in the best interest of the American people.”

This post President Trump to Highlight Crackdown on Overseas Crypto Scams first appeared on Bitcoin Magazine and is written by Micah Zimmerman.

Bitcoin Magazine

Brooklyn DA Pulls the Plug on Crypto Scam Network

The Brooklyn District Attorney’s office has dismantled the online backbone of a multinational cryptocurrency scam that drained tens of millions of dollars from Russian-speaking victims across the U.S.

Working with the FBI, investigators executed search warrants across three time zones in a matter of hours and seized or disrupted 241 scam domains and more than 100 cloud servers hosted by Eastern European and American companies. The servers held the scammers’ victim data, site content and operating software, according to a Wednesday statement. 

“Our groundbreaking Virtual Currency Unit identified the fraud, tracked the stolen cryptocurrency, broke new ground by uncovering the infrastructure behind the operation, and worked with the FBI to dismantle it,” Brooklyn District Attorney Eric Gonzalez said. 

READ MORE: https://t.co/aLVPJb2BqX

— Brooklyn District Attorney Eric Gonzalez (@BrooklynDA) October 14, 2026

“By disrupting more than 100 servers and hundreds of fraudulent websites, we have struck at the heart of this criminal enterprise and made it far harder for these scammers to victimize others. I commend our investigators and thank the FBI for their partnership in this extraordinary operation.”

The scam worked by luring victims via Russian-language investment ads on Facebook. A Russian-speaking “advisor” then called and walked them through opening an account on a fake crypto platform and buying digital assets. 

Weeks or months later, when victims tried to withdraw, they were locked out or hit with bogus “fees” and “taxes.” 

Some lost their life savings. Then the scammers came back for more: Posing as recovery services, they contacted victims weeks later and promised to retrieve the stolen money.

The unit had already taken down 400 scam domains, but new ones kept appearing. Hitting the servers behind them cuts off the scammers’ ability to launch new sites quickly or reach past victims.

The three-year investigation has recovered about $300,000 so far, and prosecutors say they are working to claw back more.

This post Brooklyn DA Pulls the Plug on Crypto Scam Network first appeared on Bitcoin Magazine and is written by Mathew Di Salvo.