A Colorado pastor and his wife, Eli and Kaitlyn Regalado, are facing charges for allegedly orchestrating a cryptocurrency scam that defrauded their Christian community of over $1 million.
The couple allegedly created and sold their cryptocurrency, named INDXcoin, to unsuspecting investors in Denver, Colorado, claiming divine guidance from the Lord for financial prosperity.
"The charges are that me and Kaitlyn pocketed $1.3m," Pastor Regalado confessed in a video published on the INDXcoin's website platform. "I just wanted to come out and say those charges are true..."
Then Regalado added that, "A few hundred thousand dollars went to a home remodel the Lord told us to do."
The state's division of securities revealed that the Regalados assured potential investors that God had instructed them to launch the cryptocurrency, promising substantial returns. However, prosecutors assert that INDXcoin was "practically worthless" in reality, resulting in substantial financial losses for more than 300 individuals between June 2022 and April 2023.
In the video statement published on INDXcoin's website, Eli Regalado admitted to the charges, revealing that the couple had misappropriated $1.3 million raised through the cryptocurrency scheme. He acknowledged that a significant portion of these funds, approximately a few hundred thousand dollars, was used for a home remodel, claiming it was an action directed by God.
"We took God at his word and sold a cryptocurrency with no clear exit," admitted Regalado, while also expressing the couple's unwavering belief that God would "work a miracle in the financial sector" for them and their investors.
The Regalados, however, not only lacked experience in cryptocurrency but also ignored significant technical problems flagged by a third-party auditor regarding the INDXcoin code. Despite these issues, they continued marketing the cryptocurrency as a low-risk, high-reward investment option.
The Regalados are also suspected of syphoning off at least $290,000 for their online-only church, Victorious Grace church, despite there being no actual physical location for it. The Denver Post reported that Eli had previously promised investors that a portion of the raised funds would be used to assist widows and orphans. However, these purported charitable payments were allegedly spent on personal gain.
Tung Chan, the Colorado securities commissioner, denounced the Regalados, stating, "We allege that Mr. Regalado took advantage of the trust and faith of his own Christian community and that he peddled outlandish promises of wealth to them when he sold them essentially worthless cryptocurrencies."
Civil fraud charges have been filed against the couple for violating several tenets of the Colorado Securities Act.
Both INDXcoin and the Kingdom Wealth Exchange, the exclusive platform for INDXcoin, were reportedly shut down towards the end of last year. The Regalados are scheduled to appear in Denver state court in the coming days and weeks.
