NY AG Seeks $1.3 Billion from Crypto Pyramid Scheme Targeting Religious Groups
New York Attorney General Letitia James is pursuing $1.3 billion from the founders of a crypto pyramid scheme that defrauded over 11,000 investors, primarily from religious communities.
New York Attorney General Letitia James is pursuing $1.3 billion from the founders of a crypto pyramid scheme that defrauded over 11,000 investors, primarily from religious communities. This is an original Token Times brief synthesising 2 outlets (The Daily Hodl, Decrypt), with their figures cross-checked, plus live market data, as of Sat, 24 Oct 2026 16:45:01 UTC.
This case highlights the growing threat of crypto-related fraud targeting vulnerable communities and the significant financial damage such schemes can inflict. It also demonstrates regulatory efforts to hold perpetrators accountable.
- NY AG seeks $1.3 billion from NovaTech founders for crypto pyramid scheme.
- Four promoters have already settled for nearly $6 million.
- Scheme defrauded over 11,000 New Yorkers, primarily from religious groups.
- Total crypto market cap remains at $2.75 trillion amid broader market downturn.
The Daily Hodl and Decrypt both report that New York Attorney General Letitia James is seeking $1.3 billion from the founders of NovaTech, a crypto pyramid scheme that defrauded over 11,000 investors. They also agree that four promoters have settled for nearly $6 million. However, Decrypt specifies that the founders have fled the country, a detail not mentioned by The Daily Hodl.
New York Attorney General Letitia James has secured a default judgment against the founders of NovaTech, a crypto pyramid scheme that targeted religious communities, seeking $1.3 billion in restitution. This development comes after the AG's office reached a settlement with four top promoters of the scheme, who have agreed to pay nearly $6 million.
The scheme, which defrauded over 11,000 New Yorkers, operated by promising high returns on cryptocurrency investments and recruiting new members through religious networks. The AG's office alleges that NovaTech operated as a classic pyramid scheme, using new investments to pay returns to earlier investors.
According to Decrypt, the founders of NovaTech have fled the country, making the pursuit of the $1.3 billion judgment more challenging. The Daily Hodl does not mention this detail but corroborates the $1.3 billion figure and the $6 million settlement with the promoters.
The case underscores the risks associated with crypto investments and the need for increased regulatory oversight. It also highlights the vulnerability of religious and other close-knit communities to financial fraud, as they are often targeted due to trust-based networks.
In the broader market context, the total crypto market cap remains at $2.75 trillion, with 
Bitcoin down 1.81% over the past 24 hours. The overall market sentiment, as measured by the Fear & Greed Index, is currently at 51, indicating a neutral outlook.
2 key figures independently matched across 2 outlets reporting this story.
Token Times 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 $1.3 Billion from Crypto Pyramid Scheme Targetin — questions & answers
How much money is the NY AG seeking from NovaTech founders?
The NY AG is seeking $1.3 billion in restitution from the founders of NovaTech.
What happened to the promoters of the crypto pyramid scheme?
Four promoters have settled with the NY AG's office for nearly $6 million.
How many people were affected by the NovaTech scheme?
The scheme defrauded over 11,000 New Yorkers, primarily from religious communities.
Which outlets reported this story?
This is an original Token Times 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 Token Times 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.