NY AG Seeks $1.3B from Crypto Pyramid Scheme Targeting Religious Groups
New York authorities pursue massive penalties against NovaTech founders for defrauding over 11,000 investors through a religious-themed crypto scam.
New York authorities pursue massive penalties against NovaTech founders for defrauding over 11,000 investors through a religious-themed crypto scam. This is an original TLT brief synthesising 2 outlets (The Daily Hodl, Decrypt), with their figures cross-checked, plus live market data, as of Sat, 24 Oct 2026 16:00:04 UTC.
This case highlights the vulnerability of religious communities to crypto scams and underscores the significant financial damage such schemes can inflict, with authorities seeking one of the largest penalties in crypto fraud history.
- NY AG seeks $1.3B from NovaTech founders for crypto pyramid scheme.
- Four promoters settled for nearly $6M after defrauding 11,000+ investors.
- Scheme specifically targeted religious and prayer groups in New York.
The Daily Hodl and Decrypt both report that New York Attorney General Letitia James is seeking $1.3 billion from the founders of crypto pyramid scheme NovaTech, with a default judgment already secured. They also agree that four promoters involved in the scheme have settled for nearly $6 million. However, Decrypt specifies that the founders have fled the country, a detail not mentioned by The Daily Hodl. The settlement amount is consistently reported as $6 million across both outlets, while the penalty sought ranges from $1.3 billion to $1.37 billion.
New York Attorney General Letitia James is pursuing a $1.3 billion penalty against the founders of NovaTech, a crypto pyramid scheme that defrauded over 11,000 investors, primarily from religious and prayer groups in the state. The scheme promised high returns through a crypto trading platform that turned out to be fraudulent.
Four promoters associated with the scheme have already settled with the authorities for nearly $6 million. This settlement is part of the broader legal action against NovaTech, which has seen its founders flee the country according to court filings.
The case underscores the growing trend of crypto-related scams targeting vulnerable communities, with religious groups being particularly susceptible to promises of financial prosperity through digital assets. The substantial penalty sought reflects the severity of the fraud and the scale of its impact.
This development comes amid a broader regulatory crackdown on crypto scams and fraudulent activities, with authorities increasingly focused on protecting retail investors from predatory schemes. The case against NovaTech is one of the largest crypto fraud cases pursued by US authorities to date.
In the current market context, with the total crypto market cap at $2.75 trillion and 
Bitcoin trading down 1.81% over the past 24 hours, this case serves as a reminder of the risks associated with crypto investments and the importance of regulatory oversight.
2 key figures independently matched across 2 outlets reporting this story.
TLT extracts the figures each outlet reports and flags the ones that agree. Numbers cited by only one outlet are attributed in the brief, not shown as corroborated.
NY AG Seeks $1.3B from Crypto Pyramid Scheme Targeting Relig — questions & answers
How much money did the NovaTech scheme defraud investors of?
The scheme defrauded over 11,000 investors, with authorities seeking $1.3 billion in penalties.
What penalties have been imposed so far in the NovaTech case?
Four promoters have settled for nearly $6 million, while the founders are being pursued for $1.3 billion.
Who were the primary targets of the NovaTech scheme?
The scheme primarily targeted religious and prayer groups in New York.
Which outlets reported this story?
This is an original TLT brief that synthesises reporting from The Daily Hodl, Decrypt, with the key figures cross-checked for agreement across them. It is not a copy of any one article — follow the source links above for the original reporting.
Original summary — not financial advice. This is an original TLT brief that summarises a development reported elsewhere and adds live market data for context; it is not the original article and reproduces no part of it. Follow the source link above for full details. Crypto is volatile and high-risk — always do your own research.