Pastor admits to selling $3.2M in worthless cryptocurrency to Christians
Eligio "Eli" Regalado, a Colorado pastor facing civil fraud charges with his wife Kaitlyn, for selling some $3.2 million in a worthless cryptocurrency to his Christian followers, admitted to pocketing $1.3 million of the funds because God told them to use some of the money to remodel their home. He claims they also gave $500,000 to the Internal Revenue Service.
"So the charges are that Kaitlyn and I pocketed $1.3 million. … I just want to come out and say that those charges are true," Regalado said in a nine-minute video to his followers that has now been made private.
A clip from that video was captured and shared on YouTube by Molly White, a researcher, software engineer and prominent critic of cryptocurrencies and blockchain-based projects.
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"There's been $1.3 million that's been taken out of, I think it was, a total of $3.4 million. But out of that $1.3, half a million dollars went to the IRS, and a few hundred thousand went to a home remodel that the Lord told us to do," Regalado said.
Colorado Securities Commissioner Tung Chan charged the Denver couple along with INDXcoin, LLC, Kingdom Wealth Exchange LLC, and other parties with selling $3.2 million worth of a cryptocurrency the Regalados created called "INDXcoin" to hundreds of Christians while claiming that God said the investment would make them wealthy.
They are accused of violations of the anti-fraud, licensing and registration provisions of the Colorado Securities Act, the Colorado Department of Regulatory Agencies said in a release last Thursday.
According to the complaint filed by the Colorado Attorney General's Office, Regalado is a pastor "who preaches through the Victorious Grace Church" and used his "connections in the evangelical Christian community to specifically target members of other churches."
The complaint said investigators from the Colorado Division of Securities found that from June 2022 to April 2023, INDXcoin raised nearly $3.2 million from more than 300 individuals who were recruited as investors from Christian communities in Denver.
And even after authorities shut down INDXcoin and Kingdom Wealth Exchange, Regalado insisted to investors that God had everything under control while he was busy splurging their money on personal expenses.
Citing the pastor and his wife's bank records, Chan alleges they splurged at least $1.3 million on a Range Rover, jewelry, luxury handbags, cosmetic dentistry, boat rentals, snowmobile adventures, home renovations and an au pair.
According to Chan, the couple had no experience in cryptocurrency. Even though a third-party auditor's report allegedly described the couple's INDXcoin code as unsafe, unsecure and riddled with serious technical problems, they allegedly continued to promote the "worthless" INDXcoin as a low risk, high profit investment.
"Kaitlyn and I are being charged in a civil charge from the Colorado Securities and Exchange Commission for basically selling millions of dollars worth of cryptocurrency that is deemed worthless by the state. Now the reason that they're saying that it's worthless is because there is no exit for people who have bought," he said.
Regalado claims that despite the criticism and the charges, he and his wife were simply following God and are still believing God for a "miracle."
"So how this whole thing started is the Lord told us in '21 to walk away from our marketing company, and he said: 'I'm going to do a new thing' and then He took us into this cryptocurrency. It was a different cryptocurrency other than INDXcoin at the time. Well, that cryptocurrency turned out to be a scam," he said.
"And so the Lord says, 'give that to them but also give them a 10x.' Well, as money is coming in, we would be sowing it, and, at first, it was hundreds of dollars and thousands of dollars, then tens of thousands of dollars.
"Money would come in, we'd tithe, we'd sow, more money would come in, and so we were just always under the impression that God was going to provide, that the source was never-ending, that God was doing a new thing and that we had nothing to worry about," he added.
"We sold a cryptocurrency with no clear exit. We did. We took God at His word and sold a cryptocurrency with no clear exit. And so the prosecutors have to take that and say, 'These people willingly sold a cryptocurrency with no clear exit.' What we're praying for and 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."
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