A pastor and leader of an online church who is accused of stealing $1.3 million through a cryptocurrency fraud scheme claims ‘Lord told us to’.
The Colorado Division of Securities said in a statement that the pastor said God told him people would become wealthy if him and his wife invested.
The couple raised nearly $3.2m for more than 300 people, with a complaint filed in Denver County District Court saying at least $1.3m of that went directly to the couple or was ‘used for their own personal benefit’.
“The Regalados had no experience in cryptocurrency which was clear when a third-party auditor’s report allegedly described their INDXcoin code as unsafe, unsecure and riddled with serious technical problems,” a press release from the Colorado Division of Securities reads.
Despite that, the Regalados allegedly continued to promote their cryptocurrency as a low risk, high profit investment.
The INDXcoin was ‘illiquid and practically worthless’, according to the complaint.
The couple allegedly spent the funds they acquired to pay for their lavish lifestyle, which apparently included buying a Range Rover, luxury handbags, jewellery, an au pair, boat rentals and snowmobile adventures, as per NBC News.
“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,” said Commissioner Chan.
“New coins and new exchanges are easy to create with open source code. We want to remind consumers to be very skeptical.”
Regalado has admitted that the charges he pocketed $1.3 million are ‘true’.
In a video statement posted to his followers on INDXcoin community forum, the pastor said: “The charges are that Kaitlyn and I pocketed £1.3m, and I just want to… say that those charges are true.
“There’s been £1.3m that’s been taken out of, I think, £3.4m, but out of the 1.3, half a million dollars went to the IRS, and a few hundred thousand dollars went to a home remodel the Lord told us to do.
“I don’t want to mince words or escape but I want to… tell you how we got here. It wasn’t that we had a million dollars sitting there and decided to go crazy with it.”
He added: “We’re going to go to court and we’re going to argue our case and say why we did it, and here’s all the journal entries leading up to this, but, yes, we’re in agreement, we did do this,” he adds.
“We took God at his word and sold a cryptocurrency with no clear exit.
“What we’re believing for still is that God is going to do a miracle. God is going to work a miracle in the financial sector.”