The pastor sold a worthless cryptocurrency to his flock and pocketed $1.3 million, using some of it to remodel his house, and insist he was only doing what God told him.
Eli Regalado and his wife, Kaitlyn, face a civil lawsuit alleging they flogged the so-called INDXcoin to fellow Christians in Colorado, with divine guarantees investors would become rich. According to the complaint filed by the Colorado Attorney General’s Office, investigators found 300 people sank $3.2 million into something Regalado and his wife insisted God was backing.
That was despite the fact that the couple, who run an online church, had no experience in cryptocurrency, said a press release from the Colorado Division of Securities, the state body that regulates the securities market.
Faced with the fraud allegations, Regalado doubled down on his message of a God-given mission, and even confessed to using the cash for some home improvements – which he said was also an instruction from above.
“So the charges are that Kaitlyn and I have pocketed $1.3 million, and I just want to come out and say that those charges are true,” he said in a video posted to a forum for INDXcoin investors.
“Out of that 1.3, half a million dollars went to the IRS and a few $100,000 went to a home remodel that the Lord told us to do.” The couple allegedly also spent funds on a gamut of luxury items, including a Range Rover, jewelry, swanky handbags and snowmobile trips, the complaint states. Facing the legal action, which was filed in Denver last week, Regalado conceded it was possible there had been some communication issues on his hotline to God, though he was still holding out hope that the Big Man would come through in the end.
“We took God at his word and sold a cryptocurrency with no clear exit,” he said. “Either I misheard God… or God is still not done with this project,” he said. “What we’re praying for… is that God is going to work a miracle in the financial sector. He is going to bring a miracle into INDXcoin.” Colorado Securities Commissioner Tung Chan said potential investors in get-rich quick schemes would be wise not to take them at face value.
“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,” Chan said. “New coins and new exchanges are easy to create with open-source code. We want to remind consumers to be very skeptical.” NBC News reported that the couple are due to appear in a Denver court next week.
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