Coin Fraud Worth 1 Trillion Won... Buying a 5.2 Billion Won Diamond and a Sports Car

Richard Hart Sued for Securities Law Violations

A fraudster who issued cryptocurrency assets worth over 1 trillion won and embezzled about 150 billion won to purchase luxury goods, including the world's largest black diamond, has been arrested and charged.

The U.S. Securities and Exchange Commission (SEC) announced on the 31st (local time) that it has charged Richard Hart (real name Richard Schueler) and three businesses he operates with violations of securities laws.

Black Diamond 'The Enigma' Sold for 5.2 Billion Won.
[Image Source=AP Yonhap News]

According to the SEC, Hart is accused of operating businesses and issuing more than $1 billion (approximately 1.27 trillion won) worth of three securities-type cryptocurrencies?Hex, PulseChain, and PulseX?without registering them as securities.

It was found that from December 2019 to November 2020, he issued Hex coins without registration and raised a total of 2.3 million Ethereum (ETH). Additionally, from July 2021 to March of last year, he issued two more unregistered coins, gathering cryptocurrency assets worth hundreds of billions of won.

Hart advertised Hex coins as the first high-yield blockchain certificate of deposit (CD) based on Ethereum, falsely guaranteeing a return rate of up to 38% to attract investors.

Hart and his business PulseChain reportedly spent at least $12 million (approximately 15.348 billion won) of the funds raised through unregistered coin issuance on luxury items such as sports cars, watches, and jewelry.

The list of luxury goods he purchased includes "The Enigma," a 555-carat black diamond known as the world's largest black diamond.

The Enigma is a 555.55-carat black diamond believed to have been formed when a meteorite collided with Earth billions of years ago. It was sold for ?3.16 million (approximately 5.2 billion won) at a Sotheby's auction in London, UK, in February last year, drawing significant attention. Hart was the winning bidder at that auction.

The Enigma was registered in the Guinness World Records in 2006 as the world's largest cut diamond. The diamond is cut into 55 facets inspired by the "hamsa," a palm-shaped amulet used in the Middle East.

In addition, he reportedly purchased a Rolex Daytona worth $550,000 (approximately 700 million won) and a Rolex GMT Master II worth $800,000 (approximately 1.023 billion won).

Earlier, in March, he stated on Twitter that he had deactivated his Instagram account "to show humility and politeness," reducing his social media activity.

An SEC official pointed out, "Hart urged investors to buy unregistered cryptocurrency securities that failed to register as securities," adding, "He then deceived investors and spent the assets on purchasing ultra-luxury goods."

This content was produced with the assistance of AI translation services.