LUCKNOW (CoinChapter.com) — The U.S. Securities and Exchange Commission (SEC) has sued Richard Heart, along with his projects Hex, PulseChain, and PulseX. The SEC alleges that Richard Heart has raised over $1 billion through three unregistered securities offerings since 2019.
Investor Fraud Allegations
According to the lawsuit filed on Monday, the SEC accuses Richard Heart of defrauding investors by using their funds for personal expenses.
In response, Heart claimed that the investments supported free speech. However, he allegedly used millions of dollars from PulseChain investors to purchase luxury goods.
The SEC points out that Richard Heart continuously promoted these investments as a path to immense wealth for investors. For instance, he claimed that HEX was designed to be the highest appreciating asset in history.
However, the SEC states that Heart failed to disclose that the success of these projects heavily relied on his efforts.
The launch of PulseX and PulseChain earlier this month encountered various challenges, such as high fees, liquidity issues, and exploitable bugs. As a result, the prices of the HEX, PLS, and PLSX tokens experienced a decline after the launch.
The lawsuit cites Richard Heart’s frequent references to federal securities laws in his YouTube live streams and public statements. Nevertheless, the SEC alleges that Healf admitted that “the success of these endeavors was completely dependent on his efforts.”
Richard Heart’s Bold Claims
According to the lawsuit, Richard Heart enthusiastically promoted Hex’s potential for investment gains.
He asserted on Hex.com (until at least Nov. 1, 2020) that “Hex is designed to surpass ETH, which did 10,000x price in 2.5 years. It’s working! So far, HEX’s USD price went up 115x in 129 days.”
Additionally, during a lengthy YouTube live stream on Dec. 2, 2019, just before the Hex Offering began, Heart claimed that Hex was specifically crafted to outperform Ethereum, Bitcoin, and all other cryptocurrencies.
The lawsuit charges Richard Heart and his projects with fraudulent securities sales violations.
As of now, Richard Heart has not provided any comments on the matter. In response to the lawsuit, SEC Fort Worth Regional Office Director Eric Werner emphasized that the suit aims to protect investors and hold Richard Heart accountable for his actions.
