Judge Dismisses SEC Case Against Crypto Entrepreneur Richard Heart
1min read A U.S. federal judge has dismissed a lawsuit brought by the Securities and Exchange Commission (SEC) against crypto entrepreneur Richard Heart, citing lack of jurisdiction over the Finland-based U.S. citizen. The ruling, issued by District Judge Carol Bagley Amon, focused solely on jurisdictional grounds and did not address the merits of the SEC's allegations against Heart's crypto projects Hex, PulseChain, and PulseX.
The SEC had accused Heart of conducting unregistered crypto offerings that raised over $1 billion. The agency claimed he used deceptive "recycling" transactions to acquire more tokens and falsely marketed high staking returns. The complaint also alleged that Heart misappropriated at least $12.1 million of PulseChain investor funds for personal luxury purchases, including a 555-carat diamond, expensive watches, and high-end automobiles.
The court rejected the SEC's argument that Heart's virtual appearances at U.S. conferences established jurisdiction. Judge Amon noted that his presence focused on a different post-offering asset and was insufficient to establish personal jurisdiction. The ruling emphasized that Heart's website contacts were not considered "active," as the complaint failed to allege that he facilitated transactions, collected credit card information, or entered into contracts with U.S.-based investors through his websites.
Judge Amon determined that Heart's online activities weren't specifically directed at U.S. investors. The court found that his communications during the offer periods consisted of "untargeted, globally available information." The SEC has been granted 20 days to file an amended complaint, addressing the jurisdictional deficiencies identified in the ruling to proceed with the case.
While Heart has prevailed against the SEC for now, he faces legal challenges internationally. In December 2024, Interpol issued a red notice for Heart, whose legal name is Richard Schueler. The notice serves as a request to law enforcement worldwide to locate and provisionally arrest Heart, citing tax fraud and assault accusations as the basis for the request.
In January 2025, Finnish authorities took action against Heart. Local police seized 20 luxury watches, most of them Rolexes, from his residence in Espoo, Finland. The seized watches have an estimated value of $2.6 million, as part of an ongoing investigation into tax evasion by Finnish law enforcement.
The court's decision highlights the complexities of establishing jurisdiction in cryptocurrency cases. 