Ponzi

James

<ul>
  
 <li>The SEC has charged NovaTech's founders with running a cryptocurrency Ponzi scheme.</li>   
 <li>NovaTech's scheme negatively impacted immigrant and religious groups. They were promised financial freedom but lost their life savings.</li>   
 <li>Legal proceedings against NovaTech continue. Promoter Martin Zizi has settled with the SEC for a $100,000 civil penalty and an activity injunction.</li> 
</ul>   
The U.S. Securities and Exchange Commission has taken action towards NovaTech's founders after the company allegedly got involved in a cryptocurrency Ponzi scheme leading to a loss of $650 million. The charges come after broader inspections by both state and federal agencies, pointing to a crackdown on such practices within the crypto industry.   
<h2 class="wp-block-heading" id="h-details-of-the-allegations">Details of the Allegations</h2>   
According to the <a href="https://www.sec.gov/newsroom/press-releases/2024-95" target="_blank" rel="noreferrer noopener">SEC</a>, NovaTech, under the leadership of Cynthia and Eddy Petion, operated as both a crypto asset investment program and a marketing (MLM) company from 2019 to 2023. The founders are accused of targeting the Haitian-American community, among other communities. The SEC's complaint indicates the operation's global impact on most investors.&nbsp;   
Eric Werner, director of the SEC’s Fort Worth regional office, emphasized the agency's commitment to holding not only the deal makers but also the promoters of such schemes accountable. This follows the agency's charges against several NovaTech promoters who allegedly continued to recruit investors despite evident regulatory red flags.   
The SEC's actions align with a recent lawsuit by New York Attorney General Letitia James, who has accused NovaTech and AWS Mining of running an illegal pyramid scheme, defrauding investors of $1 billion, including significant losses among New York residents. James stressed the severe impact on immigrant and religious communities, highlighting the deceptive promise of financial freedom while ultimately draining investors' life savings.   
<h2 class="wp-block-heading" id="h-potential-consequences-and-settlements">Potential Consequences and Settlements</h2>   
The SEC complaint details how investor funds were used for payouts to earlier investors and personal enrichment of the scheme rather than real crypto and foreign exchange market investments. As the scheme unraveled, the majority of investors were left unable to withdraw their investments, leading to widespread financial damage.   
Promoter Martin Zizi has already agreed to a conclusion with the <a href="https://cryptonewsland.com/xrp-price-surges-almost-20-as-sec-vs-ripple-lawsuit-nears-end-decisive-meeting-rescheduled-to-july-25/" target="_blank" rel="noreferrer noopener">SEC</a>, consenting to a $100,000 civil penalty and an injunction against future similar activities, pending court approval. The settlements for other promoters and the main defendants will be determined later as legal proceedings continue to unfold. 
The post <a href="https://cryptonewsland.com/novatech-founders-face-sec-charges-over-650m-crypto-fraud/">NovaTech Founders Face SEC Charges Over $650M Crypto Fraud</a> appeared first on <a href="https://cryptonewsland.com">Crypto News Land</a>.

NovaTech Founders Face SEC Charges Over $650M Crypto Fraud

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