{"id":9147,"date":"2025-03-01T07:20:36","date_gmt":"2025-03-01T06:20:36","guid":{"rendered":"https:\/\/wsj-crypto.com\/?p=9147"},"modified":"2025-03-01T07:20:36","modified_gmt":"2025-03-01T06:20:36","slug":"judge-dismisses-sec-fraud-case-against-hex-originator-richard-heart","status":"publish","type":"post","link":"https:\/\/wsj-crypto.com\/index.php\/2025\/03\/01\/judge-dismisses-sec-fraud-case-against-hex-originator-richard-heart\/","title":{"rendered":"Judge Dismisses SEC Fraud Case Against Hex Originator Richard Heart"},"content":{"rendered":"

<\/p>\n

\n

A district court magistrate has dismissed the US securities regulator\u2019s petition alleging Hex founder Richard Heart raised more than $1 billion via unregistered crypto offerings and deceived investors of $12.1 million.<\/p>\n

Heart, whose actual name is Richard Schueler, faced allegations of utilizing those supposedly misappropriated funds to acquire luxurious items \u2014 including the largest black diamond in the world.<\/p>\n

Nonetheless, Judge Carol Bagley Amon stated that those purported fraudulent actions couldn\u2019t be addressed as the Securities and Exchange Commission failed to demonstrate that the US had authority over Heart\u2019s crypto operations \u2014 which she indicated were international in nature and not specifically aimed at US investors.<\/p>\n

“The supposed misappropriation happened through digital wallets and crypto asset platforms, none of which were claimed to have any ties to the United States,” Amon remarked<\/a> in the Feb. 28 court decision.<\/p>\n

\u201cTo the degree the Complaint indicates that Heart misappropriated investor capital through misleading mixer transactions, those actions took place entirely outside of the United States,\u201d Amon elaborated.<\/p>\n

The crypto assets that the SEC claimed were unregistered securities included PulseChain (PLS), PulseX (PLSX) and HEX (HEX) \u2014 which have surged approximately 36%, 67% and 78%, respectively, since Amon issued the ruling.<\/p>\n

Heart recognized<\/a> that prevailing in a securities-related lawsuit<\/a> against the SEC is uncommon, expressing relief at the recent progress of the Pulse and Hex coins.<\/p>\n

\u201cHEX has functioned seamlessly for over 5 years. Today’s ruling favoring a cryptocurrency creator and his initiatives over the SEC provides beneficial relief and prospects for all cryptocurrencies,\u201d Heart stated<\/a> in a Feb. 28 post on X.<\/p>\n

\n

Eight of Schueler\u2019s watches were confiscated by Finnish authorities. Source: Finland Police<\/em><\/p>\n<\/figcaption><\/figure>\n

Amon, however, noted that the SEC could rectify the “shortcomings” identified in its complaint by refiling within the next 20 days (by March 20).<\/p>\n

Related: <\/strong><\/em>Gotbit founder extradited to the US to confront market manipulation and fraud charges<\/strong><\/em><\/a><\/p>\n

Along with acquiring “The Enigma\u201d \u2014 a 555-carat black diamond valued at 3.16 million British pounds ($3.97 million) \u2014 the securities regulator also alleged that Heart funneled investor resources into McLaren and Ferrari sports cars and four Rolex watches totaling $3.02 million from August 3, 2021, to September 2022.<\/p>\n

Heart, a US national believed to be residing in Finland, is not completely out of legal issues.<\/p>\n

On Sept. 13, 2024, Finnish authorities detained Heart<\/a> following accusations of tax evasion and assault. However, the relevant officials have struggled to track him down.<\/p>\n

Months later, on Dec. 22, Interpol issued a Red Notice<\/a> for Heart based on the same claims.<\/p>\n

Finnish authorities managed to confiscate around $2.6 million worth of watches<\/a> that he is suspected of abandoning.<\/p>\n

\n

Eight of Heart\u2019s watches were confiscated by Finnish authorities. Source: Finland Police<\/em><\/p>\n<\/figcaption><\/figure>\n

While authorities are still unable to locate Heart, he remains active on social media, persistently promoting his cryptocurrencies on X and producing content for his YouTube channel.<\/p>\n

Magazine: <\/strong><\/em>How cryptocurrency regulations are evolving globally in 2025<\/strong><\/em><\/a><\/p>\n