“Unmitigated greed”: Judge orders Colorado crypto pastor’s bank accounts frozen

“Unmitigated greed”: Judge orders Colorado crypto pastor’s bank accounts frozen

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State regulators may continue to freeze the bank accounts of a Denver online pastor and his wife who admitted to selling millions of dollars in worthless cryptocurrency.

Denver District Court Judge David Goldberg ruled Monday that Eli and Kaitlyn Regalado, along with their businesses and their church, cannot access their allegedly ill-gotten gains. He also prohibited the local couple from selling their cryptocurrencies or other investments in Colorado.

“This case is a sad case for me. “It is one of the most egregious cases I have seen in which someone, in the name of faith, the name of God, took advantage of his parishioners and did it in the name of the Lord,” the judge said. He called it “a case of absolute greed.”

His decision came after a two-hour hearing and testimony from state securities investigators.

“The red flags were their expenses for personal purposes”Ioana Dobra, a fraud investigator for the Colorado Division of Securities, said of an audit of the Regalados’ bank accounts. “Buying jewelry, vacations, plane tickets, clothing and home remodeling.”

The Regalados did not attend the afternoon hearing. They said last week they would be out of town and asked to reschedule. Goldberg refused to reschedule it.

The Regalados are being sued by the Colorado Division of Securities for securities fraud. Their charges are civil, not criminal, and are punishable by fines rather than imprisonment.

As BusinessDen first reported, Eli Regalado told his online followers in 2022 that God had told him to create INDXcoin, a cryptocurrency, and Kingdom Wealth Exchange, an online marketplace. In one year, people bought between $3 and $4 million worth of coins.

At least $1.3 million of that amount went directly to the Regalados, who I spent it on a Range Rover, jewelry, luxury handbags, cosmetic dentistry, home renovations, and an au pair.according to a lawsuit the Securities Division filed on Jan. 16. Meanwhile, the Kingdom Wealth Exchange closed in November, leaving INDXcoin buyers unable to trade or sell.

“The Regalados looted investor funds,” Deputy Attorney General Sarah Donahue told Goldberg. She called them “seasoned marketers” who “cruelly manipulated people.”

Goldberg agreed on Jan. 17 to freeze dozens of bank accounts, crypto wallets and Venmo accounts belonging to the Regalados, their companies and Victorious Grace Church for two weeks. Monday’s hearing was about whether that freeze should continue.

On January 19, Eli Regalado posted a seven-minute video in response to the BusinessDen article. The video has since been removed from INDXcoin’s website and social media.

“So the charges are that Kaitlyn and I pocketed $1.3 million and I just want to come out and say those charges are true,” he said in the video. “$1.3 million of a total of $3.4 million has been withdrawn. Of that, half a million dollars went to the IRS and a few hundred thousand dollars went to a house remodel that the Lord told us to do.”

Regalado described how, before INDXcoin, God told him to create a cryptocurrency, “that cryptocurrency turned out to be a scam,” and then God told him to create INDXcoin to make things right. Regalado recalled his deep skepticism toward God’s commandments.

“I said, ‘Sir, I don’t want to do this, I don’t know how to do it, I have no experience in this industry, I don’t know what I’m doing, I don’t want to get caught up in something,’” he said.

“One of two things has happened: either I misunderstood God and everyone who prayed and came (did it) wrong too, or God is not done with this project yet.”

In the video, which was played in Goldberg’s courtroom Monday afternoon, Regalado urged his followers not to blame the Colorado Securities Division for suing him.

“If you think about it, we sold a cryptocurrency without a clear exit. We did it. “We took God at his word and sold a cryptocurrency with no clear way out,” he said. “So prosecutors have to take that and say, ‘These people willingly sold a cryptocurrency with no clear way out.’ “Now we will go to court, plead our case and say, ‘This is why we did it.'”

“God is not done with this project. “God is not done with INDXcoin,” the pastor told parishioners. “Join us, believe and receive everything God has said about this project.”

Read more at our partner, BusinessDen.

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