The leader of an online church who is accused of pocketing $1.3m (£1m) through a cryptocurrency fraud scheme told his followers God told him to do it.
Eli Regalado and his wife Kaitlyn marketed their cryptocurrency, INDXcoin, to Christian communities in Denver, Colorado, saying God told him people would become wealthy if they invested, the Colorado Division of Securities said in a statement.
They raised nearly $3.2m (£2.5m) from more than 300 people. At least $1.3m of that went directly to the couple or was “used for their own personal benefit”, a complaint filed in Denver County District Court said.
According to the complaint, the money was allegedly spent on a Range Rover, luxury handbags, jewellery, an au pair, boat rentals and snowmobile adventures, Sky News’s US partner NBC News reported.
In a video statement to his followers last week, posted on the INDXcoin community forum, Regalado says the charges they pocketed $1.3m “are true”.
He says in the video: “The charges are that Kaitlyn and I pocketed £1.3m, and I just want to… say that those charges are true.
“There’s been £1.3m that’s been taken out of, I think, £3.4m, but out of the 1.3, half a million dollars went to the IRS, and a few hundred thousand dollars went to a home remodel the Lord told us to do.
“I don’t want to mince words or escape but I want to… tell you how we got here. It wasn’t that we had a million dollars sitting there and decided to go crazy with it.”
He explained that in 2021, the Lord told them to “walk away” from their previous company, and “took us into cryptocurrency”, but that “cryptocurrency turned out to be scam” – which they did not create.
He then asked “the Lord” what he should do, to which He replied that Regalado should “build this the way it should be done”.
The pastor says he plans to tell the court what happened when he appears.
“We’re going to go to court and we’re going to argue our case and say why we did it, and here’s all the journal entries leading up to this, but, yes, we’re in agreement, we did do this,” he adds.
“We took God at his word and sold a cryptocurrency with no clear exit.
“What we’re believing for still is that God is going to do a miracle. God is going to work a miracle in the financial sector.”
Regalado is a pastor for the online-only Victorious Grace Church, where he and his wife are listed as the only two employees.
The couple have been charged with violating anti-fraud provisions under the Colorado Securities Act.
Colorado Securities Commissioner Tung Chan said she filed the civil fraud charges after she was approached by people who invested and lost money through INDXcoin.
“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,” she said in a statement.
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INDXcoin was “illiquid and practically worthless,” the Securities Division said – in contrast to the couple’s claims it was a low-risk, high-profit investment.
The cryptocurrency was available only in Kingdom Wealth Exchange, which the Regalados created and operated before shutting it down. The currency can no longer be sold anywhere.
A third-party auditor described the INDXcoin code as “unsafe, unsecure and riddled with serious technical problems”, the Securities Division said.
NBC News reports that they are scheduled to appear in Denver District Court next week.
