A Colorado pastor and his wife accused of orchestrating a $3 million crypto fraud scheme have been barred from selling crypto in the state and will continue to have their accounts frozen by regulators, a judge presiding over the case ruled this week.
Uncovering the $3 Million Crypto Fraud
Just over a week ago, Pastor Eli Regalado and his wife, Kaitlyn Regalado, were charged with fraud by the Colorado Division of Securities upon discovering the couple had pocketed $1.3 million worth of crypto.
The Regalados launched their own cryptocurrency called INDXcoin through the Kingdom Wealth Exchange, a faith-based crypto exchange also created by the couple.
“Regalado targeted Christian communities in Denver and claimed that God told him directly that investors would become wealthy if they put money into INDXcoin,” a press release from the Colorado Division of Securities reads.
The Role of INDXcoin in the Crypto Scheme
In total, the Regalados raised over $3.2 million from over 300 people to benefit their scheme. According to prosecutors cited in the Denver Post, the husband and wife duo then spent a large portion of the funds on a Range Rover, home renovations, cosmetic dentistry, and more.
Meanwhile, the couple knew that INDXcoin was essentially worthless after a report by the auditor Hacken called INDXcoin code “unsafe, unsecure and riddled with serious technical problems,” and gave it a rating of “zero out of 10.”
Pastors Eli Regalado and his wife, Kaitlyn Regalado say God told them to start a crypto currency. $3.2m later, they are being sued by their flock. This is a teachable moment, no? pic.twitter.com/doaKbAdP3G
— Billy G Edwards (@BillyGEdwardsch) January 25, 2024
Despite that report, the Regalados allegedly continued to promote the INDXcoin as a low-risk, high-profit investment.
“God is not done with INDXcoin”
In a since-deleted video from INDXcoin’s website, Eli Regalado seemingly admitted to the charges brought against him and his wife.
“So the charges are that Kaitlyn and I pocketed $1.3 million, and I just want to come out and say that those charges are true,” the accused pastor said.
Eli Regalado then claimed that $500,000 worth of the money taken went to the IRS, while “a few hundred thousand” went to a renovation of his home “that the Lord told us to.”
“God is not done with this project,” he continued. “God is not done with INDXcoin.”
The Regalaldos were out of town and not in attendance during Monday’s hearing.
“This case is a sad case for me,” Denver District Court Judge David Goldberg said on Monday. “It’s one of the more egregious cases I have seen where someone in the name of faith, the name of God, preyed upon his congregants, and he did so in the name of the Lord.”
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