Key Takeaways
- Richard Heart, whose real name is Richard James Schueler, has been involved in the cryptocurrency community since its early days.
- HEX is a cryptocurrency token launched by Richard Heart in December 2019. However, the project has been highly controversial within the crypto space.
- Richard Heart and the Securities and Exchange Commission (SEC) have been involved in discussions and speculations primarily because of the nature of Heart’s crypto projects.
If you are unaware, the US Securities and Exchange Commission (SEC) has been targeting Richard Heart, whose real name is Richard James Schueler, accusing him of conducting an unregistered securities offering and misappropriating investor funds. The regulatory agency has also tried to serve him with a lawsuit since 2023, but it has yet to locate him.
In this article, let’s learn more about Richard Heart, the crypto projects he’s involved with, and why the SEC is after him.
Who Is Richard Heart?
Richard James Schueler, or Richard Heart, is a prominent figure in the crypto space. He is known for creating the cryptocurrency HEX, launched in December 2019.
Richard Heart has a significant presence on social media, where he discusses cryptocurrency trends, market analysis, and personal views on the future of digital assets. His background includes involvement in internet marketing and entrepreneurship before his focus on cryptocurrencies.
The HEX founder is notably a controversial figure in crypto as he is known for his outspoken nature and flamboyant persona. Moreover, Heart is known for flaunting a lavish lifestyle on social media, showcasing expensive cars, luxury watches, and extravagant living arrangements, contributing to his polarizing image within the community.
Despite his popularity among some segments of the crypto space, Heart has also faced many criticisms, including those regarding the marketing and mechanics of HEX, his self-promotion, and his confrontational style.
Richard Heart’s Crypto Projects
Richard Heart is associated with several projects within the crypto space. Here are three notable projects he has been involved with:
HEX (HEX)
HEX (HEX) is arguably Richard Heart’s most prominent project. Launched in December 2019, HEX is a cryptocurrency designed to function as a blockchain-based certificate of deposit (CD). It claims to allow users to stake their HEX tokens for a period of time and earn interest in return. Due to its unique mechanics and claims of high returns, the project generated considerable attention and controversy within the community.
PulseChain (PLS)
PulseChain (PLS) is a community-driven cryptocurrency network designed to function similarly to Ethereum but with improvements such as reduced transaction fees and enhanced scalability. The project aims to offer an alternative blockchain platform for decentralized applications (dApps) and smart contracts, leveraging some of the concepts from Ethereum but with adjustments to improve performance and usability.
PulseX (PLSX)
PulseX (PLSX) is a decentralized exchange (DEX) built on the PulseChain network. Similar to Uniswap, the DEX rewards liquidity providers with PLSX tokens, encouraging participation and creating a platform for efficient trading and yield farming opportunities.
Richard Heart And The US SEC
In late July 2023, the US SEC launched a major crackdown on Richard Heart and his crypto-asset offerings—HEX, Pulsechain, and PulseX.
The SEC alleges that Heart conducted unregistered crypto securities sales, raising over $1 billion. Additionally, he stands accused of orchestrating a multimillion-dollar fraud scheme, misappropriating investor funds for a luxurious lifestyle and extravagant purchases.
Furthermore, the SEC’s lawsuit accuses Heart of marketing HEX tokens as an Ethereum-based “Certificate of Deposit” with the promise of a 38% annual return. However, the Commission contends that this promise was nothing more than a smokescreen for an elaborate scheme designed to deceive investors. The regulatory agency argues that Heart deliberately avoided registering his offerings, violating securities regulations and undermining investor protections.
According to the SEC’s findings, Heart resorted to wash trading on his platforms to fabricate artificial trading volume and organic demand for HEX tokens. This strategy was aimed at giving the impression of substantial interest and attracting more investors, and the misrepresentation of trading activity could have deceived potential investors into believing that the HEX tokens were more valuable than they actually were.
The SEC alleges that Heart misappropriated at least $12 million of investor funds to finance an extravagant lifestyle. Shockingly, these funds were allegedly used to purchase luxurious items, including a 555-carat black diamond, high-end vehicles, and luxury watches.
Where Is Richard Heart Now?
The SEC has demanded a jury trial to hold Richard Heart accountable for the alleged securities fraud. The Commission also requested a permanent ban on Heart and his projects from selling “crypto asset securities.” Additionally, the agency aims to recoup ill-gotten gains, secure prejudgment interest, and impose civil penalties.
However, the SEC has been trying, and apparently failing, to hunt down the controversial HEX founder for months. In a filing submitted to a New York federal court by an SEC lawyer in November 2023, the SEC conceded that although it believes that Heart resides in Helsinki, Finland, any attempts to serve him via the Finnish Ministry of Justice have failed over the last few months.
As of this writing, Heart has not once mentioned his location, and the American government is still searching for him.
Richard Heart Blows Whistle On SEC Chairman Gary Gensler
In December 2023, Richard Heart went off on the SEC Chairman, Gary Gensler, suggesting a court action against the securities chair is needed.
He responded to the entire situation in his Christmas video stream and dropped significant bombshells on the SEC as an organization. He then went on to accuse Gensler of being corrupt.
“The SEC has lost four of their last five cases in front of the Supreme Court… Gary Gensler likes to go on television speaking outside of his capacity of the SEC. So he’ll go in interviews with people and say that he’s not speaking on behalf of the SEC. Well, buddy, that means you’re speaking on behalf of yourself… You, Gary Gensler, are manipulating markets outside of your authority at the SEC, which means you are personally responsible… You’re on record teaching at MIT saying that 75% of tokens are not securities,” Heart said at the time.
He then points out that people in the SEC must be held personally responsible for their wrong actions.
“I would love to see Gary Gensler catch a charge for manipulating markets with his speech outside of his capacity at the SEC. I would love to see him catch a charge for violating his oath. I’d love to see people suing him directly… If you’re a guard in a jail, and you violate someone’s rights, you can’t be sued around your qualified immunity. If you decide to go outside of your authority and outside of your qualified immunity protection to make statements that damage markets, maybe you should be held personally responsible for that,” Heart added.
Final Thoughts
It is important to remember that, at this stage, the allegations against Richard Heart have not been proven, and there is no concrete evidence yet to label him as a criminal. Regardless, he may inevitably be forced to attend the SEC’s summons as he cannot hide forever.
The lawsuit alleges unregistered crypto securities sales and a fraud scheme, but it is best to let the legal process run its course and avoid rushing to judgment. The trial outcome will determine the truth behind the allegations, and until then, Richard Heart should be considered innocent until proven otherwise.
