In a recent ruling by Denver District Court Judge Heidi Kutcher, pastor Eligio “Eli” Regalado Jr. and his wife Kaitlyn were ordered to repay $3.39 million after being found guilty of defrauding over 600 church members and Christian community investors through their INDXcoin crypto scheme. The court found the couple guilty of securities fraud for selling worthless tokens between June 2022 and April 2023.
Colorado Securities Commissioner Tung Chan condemned the Regalados as “21st-century false prophets” who exploited promising cryptocurrency technology to carry out a fraudulent scam, targeting their own congregants. The case gained widespread attention when Eli Regalado confessed in a viral YouTube video to using investor funds for personal expenses, including a home renovation that he claimed was instructed by the Lord.
The Denver couple managed to raise $3.4 million from more than 300 individuals, despite their lack of experience in the crypto industry and receiving a security audit score of 0 out of 10. They had promised investors that their INDXcoin would be traded on their Kingdom Wealth Exchange, which ultimately collapsed after just one day of operation. The Regalados were found to have used investor funds for luxury purchases such as jewelry, designer clothes, and even a Range Rover.
Following the civil judgment, a Denver grand jury also indicted both defendants on 40 criminal counts in July, adding to a growing trend of faith-based crypto fraud schemes that target religious communities across the United States.
This case is just one of many instances where pastors and religious figures have exploited the trust of their congregations for fraudulent cryptocurrency schemes. In a similar case, federal courts awarded the Commodity Futures Trading Commission (CFTC) $228.6 million against Eddy Alexandre for defrauding over 25,000 investors of $262 million through his EminiFX scheme. Alexandre used his church position and community standing to promote the scheme, promising high weekly returns through non-existent technology.
Another example involves former Spanish-speaking church pastor Francier Obando Pinillo, who allegedly orchestrated a multiyear fraud, raising $5.9 million from over 1,500 investors through his “Solanofi” platform. Pinillo promised monthly profits through proprietary trading bots and used multi-level marketing tactics to recruit more participants.
Colorado has become a hotspot for crypto fraud, with state investigators reporting losses exceeding $81 million from various scams. Law enforcement impersonation scams, where fraudsters pose as officials to coerce victims into sending Bitcoin, have become increasingly common. These scammers exploit the irreversible nature of crypto transactions, making fund recovery nearly impossible.
In light of these incidents, the FBI Denver office has issued warnings about the aggressive tactics employed by cryptocurrency scammers, particularly when targeting religious communities. With crypto investors losing billions to hacks, scams, and breaches, it is essential for individuals to remain vigilant and cautious when investing in the digital currency market.