Crypto influencer Richard Heart is currently facing a lawsuit from the Securities and Exchange Commission (SEC) for allegedly using at least $12 million in proceeds from his crypto products to purchase luxury items. Among his purchases are sports cars, luxury watches, and a 555-carat black diamond called The Enigma, which is believed to be the largest in the world.
Richard Heart, who was born in the US and currently resides in Finland, has been running a YouTube channel since 2017. Through this platform, he promotes his own crypto products, including the Hex token and its sister product PulseChain, which operates on the PulseX protocol.
According to the SEC’s lawsuit, Heart managed to raise over $1 billion through his unregistered Hex, PulseChain, and PulseX crypto securities. The SEC claims that Heart marketed these products as a means for investors to achieve immense wealth and even described Hex as “the highest appreciating asset that has ever existed in the history of man.”
While Heart has argued that the investments in his products were intended to support “free speech,” the SEC alleges that he failed to disclose his use of millions of dollars of PulseChain investors’ funds to purchase luxury goods for himself. Some of these purchases include a McLaren sports car worth $534,916, a Ferrari Roma worth $314,125, and a Rolex watch worth $1.38 million. It is also alleged that Heart spent $5 million of investors’ assets to acquire The Enigma in February 2022.
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Additionally, the lawsuit states that between December 2019 and November 2020, Heart accepted over 2.3 million Ethereum (ETH) valued at approximately $678 million in exchange for Hex tokens. However, the SEC claims that the majority of these ETH deposits, around 94 to 97 percent, were “recycling” transactions. These transactions allowed Heart and other insiders to control a significant number of Hex tokens while creating the false impression of high trading volume and organic demand.
Eric Werner, the director of the SEC’s Fort Worth regional office, stated, “Heart called on investors to buy crypto asset securities in offerings that he failed to register. He then defrauded those investors by spending some of their crypto assets on exorbitant luxury goods. This action seeks to protect the investing public and hold Heart accountable for his actions.”
In conclusion, Richard Heart, a prominent crypto influencer, is currently facing a lawsuit from the SEC for allegedly misusing investor funds to purchase luxury items. The SEC claims that Heart raised over $1 billion through his unregistered crypto securities and that he deceived investors by promoting his products as a pathway to significant wealth. The lawsuit also alleges that he engaged in recycling transactions and manipulated trading volume to create the false impression of demand. The SEC’s goal is to protect investors and hold Heart accountable for his alleged actions.
