Colorado Regulators Crack Down on Alleged Crypto Fraud Scheme

News | January 29, 2024 By:

The Colorado Securities Commissioner Tung Chan has charged a Denver pastor and his wife with fraud over an alleged cryptocurrency scheme targeting members of the Christian community. Chan filed civil complaints against Eli and Kaitlyn Regalado, their companies INDXcoin LLC and Kingdom Wealth Exchange as well as others.

The Regalados created and marketed a cryptocurrency called INDXcoin which they claimed could generate high profits for investors. Eli Regalado allegedly told investors that God directed him to create INDXcoin and that those who invested would become wealthy. However, a third party audit found the cryptocurrency code to have serious technical flaws and be unsafe. Despite this, the Regalados continued promoting INDXcoin.

From June 2022 to April 2023, nearly $3.2 million was raised from over 300 individuals to invest in INDXcoin. However, according to the complaint, the currency was essentially worthless and illiquid. Most investors have allegedly lost their funds while the defendants are accused of using the money to fund a lavish lifestyle.

If proven, the allegations would represent violations of fraud and licensing provisions of Colorado securities laws. The Commissioner is seeking damages for harmed investors, as well as legal action over misused funds. He warned that new cryptocurrencies and exchanges can easily be created, but consumers should exercise caution due to the risks involved.

Anyone with information relating to INDXcoin or the Regalados is asked to contact the Colorado Division of Securities at [email protected] or 303-894-2320.