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Insight and commentary on qui tam law in Oregon

If you think God is telling you to do fraud.

You’re probably going to prison.
Crypto-fraud-image
January 28, 2024

As excuses go, “the dog ate my homework” is pretty piss-poor. It raises way more questions than it answers: How’d the dog get on your desk? Why was your homework covered in beef gravy? What dogs love paper covered with graphite and eraser shavings anyways?

But if you’re going to commit fraud, then using god as an excuse is somehow worse. If you’re blaming god, then you’re really out of luck. At least with the dog, if you’re telling the truth, you might have, you know, evidence to back up your ludicrous story. You could have a picture or video of the dog eating your homework. Or, god forbid, do an x-ray to show that there actually is homework in the poor pooch’s stomach.

No evidence for god telling you to do something. And it raises lots of other questions as well. If god wanted you to have money, then why wouldn’t he/she/they/it just tell you what stock is going to go through the roof in the next year. Wouldn’t that be a much easier way to get money into your pocket. Or, you know, a hundred other examples.

Nope, not according to this pastor. According to this press release:

Eli Regalado, a pastor, and his wife Kaitlyn created, marketed and sold a cryptocurrency, known as the “INDXcoin” to members of the Christian community. The INDXcoin was also offered through the Kingdom Wealth Exchange (KWE), an online cryptocurrency exchange that they created, controlled and operated.

https://securities.colorado.gov/press-release/press-release-colorado-securities-commissioner-files-complaint-against-alleged

Sure, pretty standard stuff in the crypto world.

But, it gets better!

The pastor’s response upon being caught:

According to the complaint filed by the Colorado Attorney General’s Office, investigators from the Colorado Division of Securities found that from June 2022 to April 2023, INDXcoin raised nearly $3.2 million from more than 300 individuals. The complaint alleges that Regalado targeted Christian communities in Denver and claimed that God told him directly that investors would become wealthy if they put money into INDXcoin.

https://securities.colorado.gov/press-release/press-release-colorado-securities-commissioner-files-complaint-against-alleged

Apparently the pastor is not to blame. Nope, it’s all god’s fault:

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The pastor – who had worked in digital marketing – responded in a video message posted on the project’s website, sharing a sentiment that’s unusual from a crypto founder cornered by government authorities: “Those charges are true.”

“We sold a cryptocurrency with no clear exit,” he said, explaining that God told him to build it and give investors ten times the money they put in. “We did. We took God at his word.”

https://www.coindesk.com/policy/2024/01/23/lord-you-told-me-to-do-this-pastor-defends-taking-13m-from-failed-crypto/

But wait, it gets better. God also told them to remodel their kitchen:

The couple also took about $1.3 million from more than $3 million raised for the project. Regalado said about $500,000 went to the Internal Revenue Services, and a “few hundred thousand” was devoted to a home remodeling project that “the Lord told us to do.”

I think I will need a bit more proof for the claim “God told us to do some scams and also remodel our kitchen.”

See, there is no god of fraud.

If you would like to report crypto or financial fraud , you can contact attorneys at Markowitz Herbold PC. Vivek Kothari is a former federal prosecutor who represents whistleblowers under the False Claims Act. For a free consultation, you can contact Vivek at 503-274-7425 or vivek@markowitzherbold.com.