A Colorado pastor and his wife have been accused of duping hundreds of local Christians in a multimillion-dollar cryptocurrency scheme.
Prosecutors accuse pastor Eli Regalado and his wife, Kaitlyn, of fraudulently raising more than $3 million (£2.4 million) by selling “virtually worthless” crypto.
The Regalados pocketed at least $1.3 million in the alleged scheme between June 2022 and April 2023, according to prosecutors.
Mr. Regalado said his plan was inspired by God, according to court filings.
The pastor said that “God told him directly that investors would get rich” by investing in INDXcoin, a cryptocurrency created, marketed and sold by the Regalados, according to the complaint.
INDXcoin was offered to Denver-area Christians through the Kingdom Wealth Exchange, an online cryptocurrency exchange owned and operated by the Regalados.
The couple “had no experience with cryptocurrency,” the complaint states, and a third-party auditor deemed INDXcoin to be “unsafe, insecure, and riddled with technical issues.”
“Despite this report, the Regalados allegedly continued to promote INDXcoin as a low-risk, high-profit investment,” he said.
“In reality, INDXcoin was illiquid and virtually worthless” and the couple used the funds for “their lavish lifestyle.”
This included a Range Rover, luxury handbags, jewelry, boat rentals and snowmobile adventures, officials said.
Colorado Securities Commissioner Tung Chan has filed civil fraud charges for violations of anti-fraud protections under the Colorado Securities Act.
She said her department was informed after several complaints from people who invested in INDXcoin and lost money.
Relagado responded to the allegations in a video statement released Friday.
“The reason (Colorado) says it’s worthless is because there’s no exit for those who bought,” he said, acknowledging that cryptocurrency investors who tried to withdraw funds have not succeeded.
“We started an exchange. The exchange technology failed. Things went south and from that point on we are literally waiting for a miracle from the Lord.”
Regarding the allegation that Mr. Relagado and his wife received $1.3 million, the pastor said it was true.
“But of that $1.3 million, half went to the IRS and $200,000 went toward the house renovation that the Lord told us to do,” he said.
Many viewers left words of encouragement in the video’s comments, including “prayers go up” and “hang in there, stay strong.”
The BBC has contacted the Regalados for comment.
In the criminal complaint, Colorado prosecutors requested preliminary and injunctive relief, damages for investors and that a constructive trust be placed on the Relagados’ property.
They are scheduled to appear in Denver District Court next week.