SEC sues HEX founder Richard Heart for securities fraud

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Written on Jul 31, 2023

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HEX price tumbles as SEC sues Richard Heart for securities fraud.
SEC alleges Heart fraudulently raised more than $1 billion and misappropriated user funds.
HEX was down 30% at press time.

The price of HEX nosedived on Monday after the US Securities and Exchange Commission (SEC) sued the cryptocurrency’s creator Richard Heart for securities fraud.

SEC’s allegations against Heart include fraud

The SEC’s lawsuit against Heart, aka Richard J. Schueler, also included complaints against PulseChain and PulseX, with the regulator alleging that the defendant fraudulently raised more than $1 billion in a scheme cutting across three unregistered securities offerings.

The SEC also alleges that Heart defrauded investors by misappropriating $12 million of their funds for personal use, including in purchasing luxury goods such as sports cars and watches.

Eric Werner, SEC Director of the Fort Worth Regional Office, said:

“Heart called on investors to buy crypto asset securities in offerings that he failed to register. He then defrauded those investors by spending some of their crypto assets on exorbitant luxury goods. This action seeks to protect the investing public and hold Heart accountable for his actions.”

The SEC filed its complaint in the US District Court for the Eastern District of New York, and “seeks injunctive relief, disgorgement of ill-gotten gains plus prejudgment interest, penalties, and other equitable relief.”

HEX had plunged by more than 30% at the time of writing, trading just above $0.013. The token’s all-time high above $0.026 was reached on July 14, 2023.