A Colorado pastor and his wife have been indicted on dozens of charges related to an alleged cryptocurrency scam they are accused of masterminding to steal millions of dollars from their congregants, according to the Denver District Attorney’s Office.
Eli and Kaitlyn Regalado, who together ran the online-only Victorious Grace Church, received almost $3.4 million from investors who were buying into what they thought was the couple’s sophisticated crypto token, according to the indictment.
The token, called INDXcoin, was hyped up to Christians at their church and other churches by Eli Regalado as an investment with ‘an unparalleled risk-to-return ratio’ that made it a ‘coveted cryptocurrency to both new and experienced crypto enthusiasts,’ the filings say.
Investigators claim that the Regalados sought to line their pockets with the creation of INDXcoin and the Kingdom Wealth Exchange, the platform where the cryptocurrency would be traded.
Approximately $1.3 million, or 39 percent of the funds given to them by investors, ‘went directly to Eli and Kaitlyn Regalado’ and were used for their personal expenses, according to the charges.
The couple used the money to pay for a lavish lifestyle rather than the development or administration of the crypto project they claimed to be running, investigators said.
This included home renovations, high-end merchandise, payment for an au pair, car payments, airline tickets, manicures and many other personal expenses, according to the indictment.
The indictment does not specify what home renovations were commissioned and whether these related to their personal residence in Denver.
The couple’s home was once a modest-looking ranch with five bedrooms and three bathrooms, according to Zillow. But pictures from October 2024 show that the entire structure was torn down to build a new, bigger two-story home.
Fraud allegations against the Regalados surfaced in November 2023 when the Kingdom Wealth Exchange was shut down by state regulators.
Before the exchange was shutdown investors were told that there were 30million INDXcoins in circulation, meaning the company should have made $300million from the coins based on their supposed valuation of $1 to $1.50 per coin.
State investigators found just $30,000 in the bank.
In a since-deleted video on January 2024, Eli Regalado admitted that he and his wife pocketed at least some of the money from INDXcoin, but insisted that ‘God is not done with this project,’ according to the indictment.
Using God and religious devotion as selling points became a consistent theme in the couple’s videos promoting the coin, which they first created in 2022.
In an August 2022 video cited by the indictment Eli Regalado said: ‘It was last October [20]21, that the Lord brought this cryptocurrency to me. He said “Take this to my people for a wealth transfer.”‘
People who wanted to make an investment of less than $5,000 were instructed to send their money to Eli Regalado’s personal Venmo account, according to the indictment.
Anyone spending more than $5,000 was told to wire money to the couple’s Wells Fargo bank account, which was ‘never connected to INDXcoin, Kingdom Wealth Exchange or any other exchange,’ the indictment said.
The charging document also delves into the marketing of INDXcoin as a better alternative to stablecoins, a type of cryptocurrency that is backed by underlying reserves of another asset such as the US dollar.
The couple claimed INDXcoin was pegged to ‘the overall momentum of the crypto market,’ which they said made it immune to so-called pump-and-dump schemes, according to the indictment.
‘The defendants represented their coins as an index of the top 100 cryptocurrencies and used technical sounding terms to confuse investors when in fact the coins were essentially backed by no assets whatsoever,’ investigators claimed.
Eli and Kaitlyn Regalado now face 40 felony charges of theft, securities fraud and racketeering.
The largest loss a person or organization suffered by investing in INDXcoin was $200,000, according to the indictment.
The indictment also contains at least four pages containing the names of witnesses. All of them are redacted.
‘These charges mark a major step forward in our work to hold the Regalados accountable for their alleged crimes and to bring a measure of justice to the victims,’ Denver District Attorney John Walsh said in a statement.
‘I want to thank the prosecutors and investigators in my office, and, particularly, the investigators with the Colorado Division of Securities and the Colorado Attorney General’s Office, whose outstanding work on the case resulted in this indictment.’
The couple is scheduled to appear in court Thursday for a bail hearing.
Daily Mail UK
