NY AG Seeks $1.37B From NovaTech Founders

New York AG Targets NovaTech Founders for $1.37 Billion

The New York Attorney General is taking major legal action against the founders of NovaTech FX. Authorities are officially seeking $1.37 billion in restitution and penalties after accusing the platform of running a widespread crypto Ponzi scheme.

This significant financial demand marks a major step forward in holding crypto fraud perpetrators accountable. State officials claim NovaTech targeted vulnerable communities, promising high returns through cryptocurrency and foreign exchange trading that was largely fabricated.

Default Judgment and Settlements Revealed

The massive $1.37 billion request follows an August 2025 default judgment against NovaTech's founders. A default judgment occurs when defendants fail to respond or appear in court to defend themselves against legal charges.

In addition to the main suit against the founders, the Attorney General announced nearly $6 million in settlements with four key promoters. These promoters played a direct role in recruiting thousands of investors into the scheme.

• Four promoters agreed to settlements totaling nearly $6 million.
• The recovered funds will help provide compensation to affected investors.
• The default judgment confirms legal liability for the founders who avoided court.

How the NovaTech Ponzi Scheme Worked

To understand why this legal outcome is so important, it helps to understand how the NovaTech operation functioned. The platform pitched itself as an automated crypto and forex trading service.

Instead of generating real profits through trading, NovaTech functioned as a classic Ponzi scheme. Money deposited by newer members was used to pay fake returns to earlier members, creating the illusion of a successful business.

Past performance of digital assets or past performance of an operator is not a guarantee of future returns or future performance.

Key Takeaways for Crypto Investors

Regulatory enforcement actions by bodies like the New York Attorney General serve to protect market participants from fraudulent schemes. Investors should always evaluate platform claims carefully.

• Be cautious of platforms offering guaranteed fixed returns.
• Always verify if an operator is licensed with regulatory authorities.
• Research the background of promoters and project founders before investing.

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