SEC Charges NovaTech and Associated Promoters in Major Crypto Fraud Investigation

​The Securities and Exchange Commission (SEC) has filed charges against Cynthia and Eddy Petion, along with their company NovaTech Ltd., in connection with a massive fraudulent scheme that defrauded investors of over $650 million. The SEC's complaint highlights that NovaTech operated as a multi-level marketing (MLM) and crypto asset investment program from 2019 to 2023, deceiving more than 200,000 investors worldwide, including a significant number within the Haitian-American community.

According to the SEC, the Petions misled investors by promising high returns and capital safety while using the majority of funds to pay existing investors and fund promoter commissions. This left only a small fraction of investor funds for actual trading. The complaint also alleges that the Petions diverted millions of dollars for personal use, resulting in significant losses for investors when NovaTech eventually collapsed and failed to provide withdrawals.

In addition to the Petions, the SEC has charged several key promoters—Martin Zizi, Dapilinu Dunbar, James Corbett, Corrie Sampson, John Garofano, and Marsha Hadley—for their roles in recruiting investors and perpetuating the fraud despite awareness of red flags. The SEC's charges seek permanent injunctions, disgorgement of ill-gotten gains, and civil penalties against all defendants.

As part of the investigation, Zizi has agreed to a partial settlement involving a $100,000 civil penalty and a permanent injunction, with further monetary remedies to be determined. The SEC's investigation involved collaboration with multiple regulatory bodies, including the New York Attorney General's Investor Protection Bureau, the California Department of Financial Protection and Innovation, and securities regulators in British Columbia and Ontario.