New York Seeks $1.3B From NovaTech Founders in Prayer-Group Fraud Case
New York's attorney general filed a court motion seeking $1.37 billion from NovaTech's founders, who have fled the country, following a 2025 liability ruling in a cryptocurrency investment scheme that targeted victims through prayer groups. The state also settled with four top promoters for nearly $6 million, with some obligations extending through 2029.
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Court Motion and Founder Liability
New York's attorney general filed an October 22 motion asking a court to order NovaTech's founders to pay approximately $1.37 billion in restitution. The motion follows a 2025 liability ruling that found the founders responsible for the scheme. The founders have fled the country, complicating enforcement of any judgment, according to reporting from Decrypt and CryptoSlate.
Promoter Settlements and Staggered Payments
The state settled with four top promoters of the scheme for nearly $6 million in combined restitution. At least one of those promoters, identified as Ciceron, will make installment payments extending through 2029, suggesting the settlement amounts exceed what the promoters can pay immediately.
Victims and Scheme Details
Approximately 11,000 victims were defrauded through the scheme, which exploited prayer groups and religious communities to recruit investors. The scale of harm — with restitution claims reaching $1.37 billion — underscores the size of the fraud operation and the difficulty victims face in recovering losses while the scheme's principal operators remain outside U.S. jurisdiction.
Why It Matters
For Traders
NovaTech tokens or any related trading vehicles remain under regulatory scrutiny; position holders should assume zero recovery value.
For Investors
The case demonstrates regulators' ability to impose liability rulings but limited ability to enforce them when perpetrators flee; it signals regulatory effort over efficacy.
For Builders
Community-based onboarding and social-trust mechanisms are attack surfaces for fraud schemes; platform design should include friction against mass recruitment through closed groups.
This article is for information only and is not financial advice. Read the full disclaimer.
