The United States Securities and Exchange Commission (SEC) has made significant strides in its lawsuit against HEX founder Richard Schueler, also known as Richard Heart.
In a recent development, the SEC successfully served the lawsuit to Richard Heart at his residence in Helsinki, Finland, through a substitute service. This alternative method was employed after process servers struggled to contact Heart in person for several months.
SEC’s lawsuit against Richard Heart
The SEC initially filed a lawsuit against Richard Heart in July, alleging that he had amassed over $1 billion by selling cryptocurrencies HEX, PulseChain (PLS), and PulseX (PSLX), which the agency asserted were unregistered securities.
SEC accused Heart of defrauding investors, both in the United States and abroad, by misappropriating at least $12 million of their funds. Heart allegedly used these ill-gotten gains to acquire extravagant items, including a “555-carat diamond, expensive watches, and high-end automobiles.”
Unsuccessful attempts to serve Richard Heart in person
The legal proceedings faced a hurdle as process servers attempted to personally deliver the lawsuit to Richard Heart but were met with continuous difficulties. Over a span of nearly seven weeks, starting on September 13, process servers made multiple unsuccessful efforts.
These attempts included making phone calls, sending text messages, delivering letters, and even trying to locate Heart in person at his Helsinki residence.
As a result of the prolonged failure to serve Heart in person, the SEC resorted to substitute service. On October 31, the SEC successfully served the lawsuit to Richard Heart through this alternative method.
Substitute service is typically used when personal delivery to the defendant is unfeasible due to difficulties in locating them.
In a status report submitted to the court in early November, the SEC noted that they had been unable to locate Richard Heart since August 22, despite their awareness of his presence somewhere in Helsinki.
Heart has evidently been elusive and cautious about disclosing his whereabouts. However, this has not deterred him from maintaining an active online presence.
The lawsuit filed by the SEC against Richard Heart has garnered significant attention within the cryptocurrency and financial communities.
The allegations of selling unregistered securities and defrauding investors have raised concerns about the regulatory environment surrounding cryptocurrencies and the need for investor protection.
The legal battle between Heart and the SEC is expected to continue, with both parties presenting their arguments and evidence before the court.
The outcome of this case will have implications not only for Richard Heart but also for the broader cryptocurrency industry, as it may set precedents regarding the regulation of digital assets and the accountability of individuals involved in their issuance and trading.
