SEC Strikes Again, Charges Hex Founder for Securities Law Violation

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SEC Strikes Again, Charges Hex Founder for Securities Law Violation
  • The SEC has filed charges against Hex founder Richard Heart for conducting unregistered offerings of crypto assets.
  • Reportedly, the amount raised by the sales was used to purchase luxury goods that included sports cars, watches, and diamonds. 
  • Heart nor his team has responded to the charges made by the SEC.

The U.S. Securities and Exchange Commission (SEC) has filed charges against Hex founder and tech entrepreneur Richard Heart for conducting unregistered crypto offerings. Hex, PulseChain, and PulseX, all owned and operated by Heart, will also be charged under the complaint. 

Parts of the litigation release read, “The SEC’s complaint, filed in U.S. District Court for the Eastern District of New York, alleges that Heart, Hex, PulseChain, and PulseX violated the registration provisions of Section 5 of the Securities Act of 1933.”

In the filed complaint, the American regulatory body has also indicted Heart with misappropriating nearly $12 million of offering proceeds. This amount, the SEC alleged, was used to buy luxury goods that included sports cars, watches, and the world’s largest black diamond known as the Enigma.

The SEC believes that the founder, while marketing Hex in 2018, claimed it was the first high-yield “blockchain certificate of deposit.” Heart also promoted the Hex tokens as an investment created to make people “rich,” all the while with the intention to defraud investors, according to the statement.

During its run from December 2019 to November 2020, it is estimated Hex made over 2.3 million ETH from its sales as an unregistered offering. Furthermore, the petition alleged that Heart carried out two more unregistered crypto asset security offerings that raised millions of dollars more in crypto assets from July 2021 to March 2022. 

Adding to these allegations, the SEC claimed that Heart tried to dodge securities laws by using words such as “sacrifice assets” instead of “invest assets” while marketing his ventures. These and several other complaints lead to the filing of charges against the popular entrepreneur. 

Heart has always touted himself as a “force for good” and a “rags to riches” story while claiming on his website that he raised $27,000,000 for medical research. The Hex team nor Heart have commented on the SEC’s allegations or what their next step would be. 

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