A US pastor, Eli Regalado, and his wife, Kaitlyn, are entangled in a civil lawsuit for allegedly selling a worthless cryptocurrency, INDXcoin, to their congregation in Colorado, pocketing $1.3 million.
The couple, who operate an online church, faces accusations that they convinced 300 investors to put $3.2 million into the cryptocurrency with promises of divine guarantees for wealth.
Despite lacking experience in cryptocurrency, the Regalados insisted that God was supporting their venture, according to the complaint filed by the Colorado Attorney General’s Office.
In response to fraud allegations, Regalado defended his actions, claiming he was following divine guidance and admitted to using the funds for home improvements.
“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 reportedly utilized the funds for various luxury expenditures, such as acquiring a Range Rover, purchasing jewelry, high-end handbags, and indulging in snowmobile trips, as outlined in the complaint.
In response to the legal action filed in Denver last week, Regalado acknowledged the possibility of communication issues with his divine guidance but maintained hope that divine intervention would ultimately prevail.
“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.