SEC Hits The Cryptocurrency Industry Again, Drags Hex Founder

Latest report from the cryptocurrency industry says that for the upthread time in two years, the U.S. Securities and Exchange Commission (SEC) struck another cryptocurrency company. In the latest development, SEC dragged Richard Heart, the Hex founder and serial technology entrepreneur, for illegal cryptocurrency operations.

A close source familiar with the case says the founder was charged with almost the same crime as XRP: carrying out unregistered cryptocurrency offerings. Also, two other companies owned by Mr. Heart: PulseX and PulseChain, were also charged with the same crime.

Parts of the litigation statement gathered say that the SEC’s complaint was filed in the United States District Court for the Eastern District of New York. The report also reads that PulseX, Hex, PulseChain, and Heart violated the registration provisions, as enshrined in “Section 5 of the Securities Act of 1933.”

In the SEC complaint filed by SEC, they emphasized that Heart also misappropriated nearly $12 million of the company’s proceeds. According to SEC’s allegations, Heart had spent these funds on acquiring luxury personal assets. Among the items mentioned are luxury sports cars, the Enigma diamond, one of the world’s largest black diamonds, and luxury wristwatches.

Also, according to the report, SEC uncovered that in 2018, when the company was promoting their company’s first high-income “blockchain certificate of deposit,” Mr. Heart also promoted the Hex tokens. They also stated that he, through the company, had marketed the Hex as an investment that promised prospective investors a reasonable profit. The statement also claimed that Hex had an intention of defrauding his investors throughout the days while this marketing was going on.

SEC Accuses Hex Of Making 2.3 Million From ETH Sales

Also, in the official statement issued by SEC, the commission narrated Heart’s Hex made over 2.3 million ETH profit from the sales of unregistered financial offerings from December 2019 –  November 2020. The petition also said that Hearts made some more million dollars from several more cryptocurrency assets from July 2021 – March 2022.

Also included in the allegations is Heart’s intention to evade the securities laws by using the word “sacrifice assets” as against “invest assets,” which is the recommended word to use during their marketing campaigns. Meanwhile, before these allegations, Mr. Heart has always carried dubbed himself with the term “force for good” and the most popular one, “rags to riches.”

Heart describes himself with these terms during one of the stories he told on his website about how he made $27 million for medical research. As of the time of this report, there hasn’t been any comment from Heart or any of his companies that would stand as a response to the accusations; neither has the Security and Exchange Commission issued another statement on their next step. It was also gathered that this development shows that the investigation is still on and is currently headed by Derek Kleinmann and  Jaime Marinaro of the Fort Worth  B. David Fraser

Eric Werner and Sarah S. Mallett are supervising the investigation, also from Fort Worth Regional Office – and assisted by the Cryptocurrency Assets and Cyber Unit staff: David Hirsch and Jorge G. Tenreiro. Also, the litigation aspect of the investigation will be handled by Matthew J. Gulde and supervised by  B. David Fraser.

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