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The U.S. Securities and Exchange Commission (SEC) has accused the founders and promoters of NovaTech of organizing a pyramid scheme that raised more than $650 million in crypto assets.
Cynthia and Eddie Petion's NovaTech Ltd. has raised funds from more than 200,000 investors worldwide, according to a statement. Martin Zizi, Dapilin Dunbar, James Corbett, Corrie Sampson, John Garofano and Marsha Hadley are also facing charges for their roles in promoting the scheme.
The petions managed NovaTech as an MLM project for investing in cryptocurrencies from 2019 to 2023, the regulator notes. They attracted money from investors, promising to invest it in digital assets and currency markets.
Investors were guaranteed "security of investment, profit from the first day and access to capital." However, in reality, most of the funds were used for payments to existing investors, promoters, and for personal purposes of the Petions.
"MLM schemes of this scale require the activity of promoters to maintain. Our actions show that we will hold accountable not only the organizers, but also the promoters who distribute scam, illegally attracting victims," said Eric Werner, director of the SEC's regional office in Fort Worth.
The Commission charged the defendants with violating anti-fraud regulations and registration requirements. The regulator is seeking a permanent injunction, the imposition of civil penalties and a refund of funds.
Zizi agreed to a partial settlement without admitting or denying the charges.
• Source: https://www.sec.gov/newsroom/press-releases/2024-95?utm_medium=email&utm_source=govdelivery
In June, New York Attorney General Letitia James filed a lawsuit against NovaTech and related individuals and companies, claiming that hundreds of thousands of investors lost more than $1 billion as a result of the scheme's activities.
• Source: https://ag.ny.gov/sites/default/fil...e_of_v_people_of_the_state_of_complaint_2.pdf
Cynthia and Eddie Petion's NovaTech Ltd. has raised funds from more than 200,000 investors worldwide, according to a statement. Martin Zizi, Dapilin Dunbar, James Corbett, Corrie Sampson, John Garofano and Marsha Hadley are also facing charges for their roles in promoting the scheme.
The petions managed NovaTech as an MLM project for investing in cryptocurrencies from 2019 to 2023, the regulator notes. They attracted money from investors, promising to invest it in digital assets and currency markets.
Investors were guaranteed "security of investment, profit from the first day and access to capital." However, in reality, most of the funds were used for payments to existing investors, promoters, and for personal purposes of the Petions.
"MLM schemes of this scale require the activity of promoters to maintain. Our actions show that we will hold accountable not only the organizers, but also the promoters who distribute scam, illegally attracting victims," said Eric Werner, director of the SEC's regional office in Fort Worth.
The Commission charged the defendants with violating anti-fraud regulations and registration requirements. The regulator is seeking a permanent injunction, the imposition of civil penalties and a refund of funds.
Zizi agreed to a partial settlement without admitting or denying the charges.
• Source: https://www.sec.gov/newsroom/press-releases/2024-95?utm_medium=email&utm_source=govdelivery
In June, New York Attorney General Letitia James filed a lawsuit against NovaTech and related individuals and companies, claiming that hundreds of thousands of investors lost more than $1 billion as a result of the scheme's activities.
• Source: https://ag.ny.gov/sites/default/fil...e_of_v_people_of_the_state_of_complaint_2.pdf
