Million

2026

Four

Billion

<ul>
 <li><strong>New York’s October 22, 2026 court filing seeks $1.367 billion from NovaTech and founders Cynthia and Eddy Petion.</strong></li>
 <li><strong>Records obtained from CoinPayments and B2Broker show that only 2.24% of documented investor deposits reached the trading platform.</strong></li>
 <li><strong>Investigators identified substantial transfers to wallets associated with the founders, but incomplete records complicate investor identification.</strong></li>
 <li><strong>Four promoters agreed to pay nearly $6 million, while no victim compensation process was announced in the latest enforcement update.</strong></li>
</ul>
<p>New York’s $1.37 billion monetary claim against NovaTech’s founders rests on an accounting investigation that exposes two problems: almost none of the cryptocurrency collected from investors reached the advertised trading operation, and authorities still lack the information needed to identify many of the people who lost money.</p>
<p><strong><a href="https://ag.ny.gov/sites/default/files/settlements-agreements/new-york-v-nova-tech-ltd-et-al-affirmation-2026.pdf" rel="noopener noreferrer nofollow">An October 22, 2026 sworn affirmation</a></strong> details how the New York Attorney General’s Office reconstructed NovaTech’s finances using records obtained from cryptocurrency payment processor CoinPayments and trading infrastructure provider B2Broker.</p>
<p>The filing, submitted in New York County Supreme Court under Index No. 451633/2024, seeks monetary relief against Cynthia and Eddy Petion and their associated NovaTech entities.</p>
<p>It follows an August 4, 2025 default judgment that established liability and imposed industry restrictions. The requested monetary award remains subject to the court’s determination.</p>
<h2 id="court-records-trace-1-16-billion-through-coinpayments">Court Records Trace $1.16 Billion Through CoinPayments</h2>
<p>NovaTech attracted investors between 2019 and 2023 by advertising weekly trading profits of approximately 2% to 4%, alongside recruitment commissions.</p>
<p>The state’s evidence shows a substantial mismatch between those representations and actual trading activity.</p>
<p>In paragraph 24 of the October filing, Senior Enforcement Counsel Tanya Trakht cites records obtained directly from B2Broker. They show that NovaTech transferred $25,994,603 to its trading platform, where $18,189,417 was lost.</p>
<p>CoinPayments separately supplied NovaTech’s transaction history, which investigators converted into spreadsheets for accounting analysis.</p>
<p>The records showed $1,160,544,294 in investor cryptocurrency deposits between August 15, 2019, and May 23, 2023.</p>
<p>That places the documented trading allocation at approximately 2.24% of deposits, while the trading operation lost about 70% of the capital allocated to it.</p>
<p>The evidence provides a documented basis for the state’s allegation that NovaTech’s advertised investment profits were not supported by genuine trading performance.</p>
<h2 id="how-new-york-calculated-the-1-37-billion-claim">How New York Calculated the $1.37 Billion Claim</h2>
<p>The requested award is based on documented investor deposits, with an allowance for funds transferred to B2Broker.</p>
<p>It is not a calculation of cryptocurrency currently held by the founders.</p>
<div style="max-width: 720px; width: 100%; margin: 24px auto; font-family: Arial,Helvetica,sans-serif; color: #243247; box-sizing: border-box; background: #ffffff;">
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   Court Filing Analysis
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  <div style="font-size: 19px; line-height: 1.35; font-weight: 800; color: #172b4d; margin-top: 5px;">
   How the $1.367 Billion Claim Was Calculated
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   New York Supreme Court, NYSCEF Document 134, paragraphs 42–46.
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    Investor cryptocurrency deposits
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   <div style="font-size: clamp(18px,4.5vw,21px); font-weight: 800; color: #172b4d; margin-top: 3px; overflow-wrap: anywhere;">
    $1,160,544,294
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    Less: amount allocated to B2Broker trading
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   <div style="font-size: clamp(17px,4.5vw,19px); font-weight: 800; color: #9b453e; margin-top: 3px; overflow-wrap: anywhere;">
    − $25,994,603
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    Requested disgorgement
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   <div style="font-size: clamp(18px,4.5vw,21px); font-weight: 800; color: #204f80; margin-top: 3px; overflow-wrap: anywhere;">
    $1,134,549,691
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    Plus: prejudgment interest
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   <div style="font-size: clamp(17px,4.5vw,19px); font-weight: 800; color: #172b4d; margin-top: 3px; overflow-wrap: anywhere;">
    + $232,473,894
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   <div style="font-size: 11px; font-weight: bold; color: #cbd8e8; line-height: 1.5;">
    TOTAL MONETARY RELIEF REQUESTED
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    $1,367,023,585
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  The amount is requested in the state’s motion. It is not a confirmed recovery or money already distributed to investors.
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<p>The filing’s methodology contains an important decision.</p>
<p>Investigators identified approximately $1.149 billion in withdrawals from NovaTech’s CoinPayments wallet. Some went to investors and promoters, including individuals who received substantial recruitment commissions.</p>
<p>The Attorney General argues that these payments should not reduce the disgorgement calculation because they were funded by fraudulently obtained investor deposits rather than legitimate trading profits.</p>
<p>The state instead deducted the entire amount transferred to B2Broker.</p>
<p>The filing also identifies $68.64 million in CoinPayments deposits that investigators could not conclusively attribute to investors. Those transactions were excluded from the requested calculation.</p>
<p>The exclusion limits the amount claimed, although the court must still determine the appropriate monetary relief.</p>
<h2 id="missing-identity-records-complicate-investor-restitution">Missing Identity Records Complicate Investor Restitution</h2>
<p>The most consequential limitation in the state’s investigation appears in paragraphs 34 and 38 of the sworn affirmation.</p>
<p>CoinPayments supplied transaction histories, but many NovaTech accounts were identified only by usernames.</p>
<p>Investigators said those identifiers could not reliably be connected to real individuals without accounting records the defendants had been ordered to produce.</p>
<p>Withdrawal records presented a similar obstacle. They contained destination cryptocurrency addresses but generally did not identify the people controlling those wallets.</p>
<p>Authorities could therefore reconstruct substantial aggregate flows without establishing a complete investor-by-investor account of deposits and withdrawals.</p>
<p>That gap matters for any eventual compensation process, which would require reliable information about eligible claimants and their net losses.</p>
<p>The filing states that the defendants failed to provide the ordered investor records and accounting following the August 2025 judgment.</p>
<p>It identifies another unresolved gap involving QuickiPay, a payment processor NovaTech explored using in 2022. Investigators said they could not locate and subpoena the provider, leaving additional transaction information unavailable.</p>
<p>The missing records limit the state’s ability to establish precisely who received funds and how much individual investors lost.</p>
<h2 id="founders-wallets-received-at-least-134-5-million">Founders’ Wallets Received at Least $134.5 Million</h2>
<p>Paragraph 37 of the affirmation identifies transfers associated with NovaTech founders Cynthia and Eddy Petion.”</p>
<p>According to the state’s accounting, Cynthia Petion authorized at least $134,518,775 in cryptocurrency withdrawals from NovaTech’s CoinPayments account to wallets belonging to herself and Eddy Petion.</p>
<p>The amount represents approximately 11.6% of documented investor deposits.</p>
<p>Those historical transfers do not establish that equivalent assets remain available for seizure. The filing does not provide a complete inventory of recoverable property.</p>
<p>Authorities would still need to establish current ownership or control and obtain access to any assets identified through enforcement proceedings.</p>
<p>The founders’ reported departure from the United States could further complicate collection.</p>
<h2 id="four-promoters-agree-to-nearly-6-million-in-payments">Four Promoters Agree to Nearly $6 Million in Payments</h2>
<p>The monetary application coincides with settlements involving four former NovaTech and AWS Mining promoters.</p>
<p>According to the New York Attorney General’s<strong><a href="https://ag.ny.gov/press-release/2026/attorney-general-james-secures-nearly-6-million-crypto-scammers-who-targeted" rel="noopener noreferrer nofollow"> October 22 announcement</a></strong>, the agreements establish the following payment obligations:</p>
<ul>
 <li><strong>Martin Zizi:</strong> $2.9 million.</li>
 <li><strong>Frantz Ciceron:</strong> $2.05 million.</li>
 <li><strong>James Corbett:</strong> $750,000.</li>
 <li><strong>Ricardo Roy Sr.:</strong> $275,861.</li>
</ul>
<p>All four accepted permanent restrictions on participating in the securities, commodities and cryptocurrency industries.</p>
<p>The <strong><a href="https://ethnews.com/libra-lawsuit-dismissed-but-the-250m-collapse-was-never-judged/" rel="noopener noreferrer nofollow">settlements are</a></strong> intended to benefit victims. However, the announcement does not specify how much has already been collected, whether distributions have begun or how claimants will be selected.</p>
<p>These agreements are separate from the monetary application against the Petions.</p>
<p>The case is also distinct from the SEC’s federal action filed in August 2024, which alleges securities fraud involving NovaTech and several promoters.</p>
<h2 id="where-novatech-victims-can-check-official-recovery-updates">Where NovaTech Victims Can Check Official Recovery Updates</h2>
<p>The latest New York announcement does not identify a court-appointed claims administrator, announce an open restitution portal or specify a payment date.</p>
<h3 id="investors-can-follow-developments-through-official-sources">Investors can follow developments through official sources:</h3>
<ul>
 <li><strong>New York Attorney General’s October 22 announcement:</strong> The latest enforcement and promoter-settlement update.</li>
 <li><strong>October 22 monetary-relief filing:</strong> The sworn accounting supporting the $1.367 billion request.</li>
 <li><strong><a href="https://iapps.courts.state.ny.us/nyscef/HomePage" rel="noopener noreferrer nofollow">New York State Courts NYSCEF portal</a>:</strong> Search for People of the State of New York v. Nova Tech Ltd., Index No. 451633/2024, to review publicly accessible court filings.</li>
 <li><strong><a href="https://ag.ny.gov/investor-protection-complaint-form" rel="noopener noreferrer nofollow">New York Attorney General Investor Protection Bureau complaint form</a>:</strong> An official channel for reporting investment-related fraud. Filing a complaint does not constitute registration for restitution.</li>
</ul>
<p>Investors should be cautious of unsolicited recovery offers claiming that funds can be released after payment of a processing fee, tax or wallet-verification charge.</p>
<p>Requests for seed phrases, private keys or additional cryptocurrency transfers are serious warning signs.</p>
<p>Any purported recovery program should be independently checked against official court documents or regulator announcements before investors provide information or transfer assets.</p>
<h2 id="the-next-test-is-recovering-investor-funds">The Next Test Is Recovering Investor Funds</h2>
<p>The August 2025 default judgment established liability against the relevant defendants. The October 2026 application seeks to quantify the monetary consequences.</p>
<p>The state’s accounting now documents investor deposits, limited trading activity and substantial transfers associated with the founders.</p>
<p>Its unresolved challenge is converting that evidence into enforceable collections and a reliable record of eligible victims.</p>
<p>The next meaningful development will be the court’s monetary determination, followed by evidence of actual collections and an officially verified process for compensating investors.</p>
<p>The post <a href="https://ethnews.com/inside-a-1-37-billion-crypto-collapse-why-victims-may-never-see-their-money/" rel="noopener noreferrer nofollow">Inside a $1.37 Billion Crypto Collapse: Why Victims May Never See Their Money</a> appeared first on <a href="https://ethnews.com" rel="noopener noreferrer nofollow">ETHNews</a>.</p>

Inside a $1.37 Billion Crypto Collapse: Why Victims May Never See Their Money

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