SEC Cracks Down on NovaTech for $650M Crypto Fraud

The U.S. Securities and Exchange Commission (SEC) has charged NovaTech Ltd. and its founders, Cynthia and Eddy Petion, with operating a fraudulent cryptocurrency scheme that raised over $650 million from more than 200,000 investors globally. The SEC alleges that NovaTech was a multi-level marketing scheme that misled investors into believing their funds would be invested in crypto assets and foreign exchange. Instead, the majority of the funds were used to pay existing investors and commissions to promoters, with only a minimal portion actually invested. The Petions are also accused of siphoning millions of dollars for personal use.

In addition to the Petions, six promoters—Martin Zizi, Dapilinu Dunbar, James Corbett, Corrie Sampson, John Garofano, and Marsha Hadley—have been charged for their roles in promoting the scheme. The SEC's complaint seeks permanent injunctive relief, disgorgement of ill-gotten gains, and civil penalties. This legal action follows earlier warnings and orders from various Canadian securities commissions regarding NovaTech's activities. The New York Attorney General has also filed a lawsuit against Cynthia Petion and others for defrauding thousands of investors.