© Reuters
Investing.com – The SEC has just accused a cryptocurrency entrepreneur of illegally raising more than $1 billion in unregistered token offerings, before spending more than $12 million of that sum to afford luxury goods.
Richard Schueler, known online as Richard Heart, spent client funds on luxury goods such as a white Ferrari (NYSE:) Roma and rare Rolexes, including an “Eye of the Tiger” Daytona by $550,000 and an $800,000 GMT-Master II, according to SEC lawsuits.
But Mr Schueler’s most unconventional purchase may be a billion-year-old black diamond, dubbed “the Enigma”, which may have come from outer space.
Before it all fell apart in March, Mr. Schueler managed three unregistered securities: Hex, PulseChain and PulseX. According to the lawsuits filed by the SEC, Heart has consistently touted its investments as a path to “grandiose wealth”, stating that Hex, for example, “was designed to be the fastest-appreciating asset ever.” never existed in the history of man”.
“Heart spent nearly $7.2 million of PulseChain investor assets to buy luxury watches and high-end cars in the United States, Finland and Estonia,” the regulator said in a statement. the legal action.
Additionally, “Heart embezzled approximately $5 million in assets from PulseChain investors, sending the majority of the assets to Sotheby’s in February 2022 to purchase a 555-carat black diamond called ‘The Enigma’, allegedly the largest black diamond ever. Heart purchased the diamond for $4.28 million at the time of the transaction, funding the purchase by transferring both ETH and fiat currency to Sotheby’s,” the report added.
The SEC is on a war footing against the cryptocurrency industry this year. In the first half of 2023 alone, it sued Binance for running an illegal exchange, accused Sam Bankman-Fried and his executives of paying themselves multimillion-dollar bonuses, and launched a lengthy lawsuit to determine whether the tokens could be considered genuine securities. She also indicted Gemini, Genesis, Tron, Bittrex and the company behind TerraUSD.
“Heart, Hex, PulseChain, and PulseX violated federal securities laws by offering and selling securities without registration. Additionally, by misappropriating investor assets, Heart and PulseChain defrauded their investors,” the statement said. regulatory authority.
Last week, SEC Chairman Gary Gensler called the cryptocurrency world “riddled with fraud, riddled with hucksters” as he exposes some of the worst crimes in the troubled industry.