The Securities and Exchange Commission (SEC) of the United States is strongly opposing Richard Heart’s request to throw out a $1 billion case. The SEC says it has power over Heart even though Heart says he lives outside of the United States.
Heart, whose real name is Richard Schueler, is being sued since July 2023. The claim says that Heart raised more than $1 billion through unregistered stock offerings connected to his cryptocurrency businesses, such as HEX, PulseChain, and PulseX. The SEC says Heart cheated investors out of money by living a fancy life and buying expensive cars, fashion watches, and a big black diamond worth more than $4 million.
Heart’s lawyers say that the SEC doesn’t have the power to charge him because he lives outside of the US and hasn’t done anything directly in the US. In addition, they say that Heart’s projects are autonomous and like Bitcoin, which is not a protection.
To this, the SEC says that Heart’s attendance at events in the US and his marketing efforts aimed at American investors show a strong ties to the country. The SEC’s report, which became public on August 22, 2024, shows that Heart is interested in the U.S. market by mentioning his attendance at virtual talks in Las Vegas and a podcast in person in Miami.
The case also looks at whether HEX, PulseChain, and PulseX are stocks. The SEC says these tokens were sold as investment contracts, so they are subject to securities laws. Heart’s argument says they are autonomous technologies like Bitcoin.
PulseChain and HEX’s market values have already been affected by the current legal fight. Both cryptocurrencies have lost a lot of value since their high points.
