U.S. Judge Dismisses SEC Fraud Case Against Hex Founder Richard Heart

• Judge rules SEC lacks jurisdiction over, Hex Founder, Heart’s global crypto activities.
• SEC can refile lawsuit after February ruling dismissing fraud charges.
• Heart faces separate legal issues in Finland, including tax fraud charges.

A U.S. judge dismissed the SEC’s fraud lawsuit against Richard Heart, the founder of the Hex cryptocurrency project. The court ruled that the SEC failed to prove U.S. jurisdiction over Heart’s global crypto activities. Heart, also known as Richard Schueler, was accused of defrauding investors and raising over $1 billion through unregistered crypto offerings.

Judge Tosses Case Against Hex Founder

Judge Carol Bagley Amon’s ruling, made on February 28, focused on the lack of a connection between the alleged fraudulent actions and the United States. The SEC’s lawsuit accused Heart of misappropriating $12.1 million from investors. However, the judge stated that the SEC did not establish jurisdiction over Heart’s global operations.

U.S. Judge Dismisses SEC Fraud Case Against Hex Founder Richard Heart 3

The SEC had claimed that Heart used investor funds to purchase luxury items such as a $3.97 million black diamond. Additionally, the SEC alleged that he bought high-end sports cars and expensive watches. Heart faced accusations of using crypto asset platforms and digital wallets that had no ties to the U.S.

In her ruling, Judge Amon emphasized that the SEC failed to demonstrate that the activities took place within U.S. jurisdiction. According to the judge, the alleged fraudulent transactions occurred outside the United States. Furthermore, the crypto assets involved, including PulseChain (PLS), PulseX (PLSX), and HEX (HEX), were not registered as securities.

Heart Faces More Legal Pressure in Europe

However, Judge Amon gave the SEC 20 days to amend its complaint and address the deficiencies identified in the case. If the SEC refiles by March 20, it may continue its legal pursuit against Heart.

Moreover, Heart remains entangled in legal issues outside the United States. Finnish authorities detained him on charges of tax fraud and assault in September 2024. Although they have been unable to locate him, Heart continues to promote his cryptocurrencies on social media.

In December 2024, Interpol issued a Red Notice for Heart, seeking his arrest on similar charges. Finnish authorities seized watches worth around $2.6 million, believed to have been abandoned by Heart. However, his legal troubles continue and his whereabouts remain unclear.

Price Action

Following the decision, the PulseChain, PulseX, and HEX tokens saw a significant increase in price. PulseChain gained 36%, PulseX rose by 67%, and HEX saw an increase of 78%. Heart expressed relief at the verdict, stating that it provided a positive outcome for his cryptocurrency projects.