June 23, 2024

New York Attorney General Files Suit Against Alleged Crypto Pyramid Schemes Targeting Haitian Immigrants

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New York Attorney General Letitia James has filed a lawsuit against two purported cryptocurrency companies and their leading promoters, a married couple, for allegedly operating consecutive pyramid schemes that predominantly targeted Haitian immigrants in the U.S. The complaint, filed on Thursday, accuses the schemes of bilking investors out of over $1 billion.

The lawsuit names AWS Mining and NovaTechFX as the two fraudulent operations. According to the complaint, AWS Mining, an Australian company, ran from 2017 until its collapse in 2019, promising investors a 200% return on their investment in crypto mining within 13-15 months. The company rewarded its promoters, including Cynthia and Eddy Petion, with a 10% commission on the investments they recruited, along with bonuses and ceremonial titles.

The Petions, originally from Florida but now based in Panama, were key promoters for AWS Mining, each recruiting at least 200,000 investors. When AWS Mining collapsed in April 2019, the couple founded NovaTechFX, a crypto and foreign exchange trading platform, with Cynthia as CEO and Eddy as COO. NovaTechFX advertised up to 4% weekly returns and similarly recruited former AWS Mining promoters.

From August 2019 to April 2023, NovaTechFX attracted over $1 billion in investor deposits. However, by June 2022, as state securities regulators began scrutinizing the company, the Petions sold their Florida home and moved to Panama. Cynthia Petion advised her promoters to leave the U.S. to avoid legal repercussions, saying, “They can’t serve you if they can’t find you lol.”

By December 2022, amid the collapse of crypto exchange FTX, many NovaTechFX investors sought to withdraw their funds. The company halted withdrawals in February 2023 and shut down in May, failing to return “tens of thousands” of investors’ deposits, resulting in “hundreds of millions of dollars in losses.”

The complaint alleges that the Petions and their team targeted Haitian immigrants in religious communities, exploiting their faith and financial struggles. Cynthia Petion, who began calling herself “the Reverend CEO,” claimed she had a divine vision for the company and regularly hosted prayer groups to market the scheme. Promoters like Martin Zizi likened Cynthia to historical figures, further legitimizing her in the eyes of investors.

Despite their public persona, the Petions privately mocked their investors, referring to them as “a cult” and themselves as “Zookeepers” managing mindless followers.

This alleged affinity fraud closely mirrors the case of Eddy Alexandre, founder of EminiFX, who also targeted Haitian religious communities in a crypto pyramid scheme. Alexandre was arrested in 2022 and sentenced to nine years in prison for fraud.

AG James’ suit accuses AWS Mining, NovaTechFX, the Petions, and other named promoters of violating the Martin Act, New York’s stringent anti-fraud law, as well as engaging in repeated fraud and illegal activities. The lawsuit seeks damages, restitution for the victims, and permanent bans preventing the defendants from participating in any future investment schemes.

This lawsuit follows a class action filed against NovaTech and Cynthia Petion earlier this year. As of now, there are no criminal charges against the Petions or the other promoters.

Financial Desk

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