A man identifying himself as a “Crypto Pastor” is under scrutiny for allegedly misappropriating $1.3 million from investors involved in his cryptocurrency venture. Eli Regalado, who has a criminal history that includes time served in a Colorado prison for car theft, has been labeled a “scammer” and “con man” by one of his former spouses, according to an investigation by CBS. Regalado claims that his financial scheme was divinely inspired.
Regalado and his wife, Kaitlyn, face a total of 40 charges related to racketeering, theft, and securities fraud, following an indictment from a grand jury in Denver. When contacted by CBS News Colorado, Regalado asserted that divine intervention would aid them in their legal troubles, but he refrained from providing additional comments. Kaitlyn’s attorney, Scott Reisch, also declined to discuss the case against her.
Nicole Brown, one of Regalado’s ex-wives, reflected on her three-year marriage to him from 2017 to 2020, describing him as initially “charming” but later manipulative. She recounted how he pressured her into an elopement, saying, “If you don’t marry me, you don’t love me,” which left her feeling coerced. Brown, who was 23 at the time, revealed that after their wedding, Regalado’s demeanor changed significantly, becoming angry and verbally abusive.
Regalado’s Religious Transformation
Brown noted that Regalado exhibited no religious tendencies during their marriage, lacking attendance at church or engagement with the Bible. Despite his marketing background, she claimed he shifted his focus to religion as a means to attract a new audience for his schemes. “He was all about get rich quick,” she stated, alleging that he manipulated people into investing in his venture by claiming he received messages from God.
Criminal Background Uncovered
Before their divorce, Regalado disclosed aspects of his criminal history to Brown, revealing that he had been incarcerated twice, once for automobile theft. He recounted how he would impersonate a valet to steal cars. State records confirm his history, including a guilty plea to theft in 2000, a third-degree assault charge in 2001 involving a violent confrontation, and multiple DUI offenses. He served time for various crimes, including aggravated motor vehicle theft, for which he received an eight-year prison sentence.
Brown expressed disbelief that individuals would invest substantial sums in Regalado’s cryptocurrency initiative, understanding how he could manipulate narratives to his advantage. State securities regulators and Denver prosecutors allege that between 2022 and 2023, the Regalados solicited approximately $3.4 million from around 300 investors affiliated with their online church, Victorious Grace Church, or the broader Christian community. Through online presentations, Regalado promised extraordinary returns, claiming divine direction to pursue the cryptocurrency venture.
However, the investment scheme quickly unraveled, with Regalado admitting in an online message that he and his wife had misappropriated over $1.3 million for personal expenditures, including taxes, dental work, luxury items, and home renovations, which he justified as divinely sanctioned. In a widely shared video, Regalado acknowledged the allegations, stating, “the charges are that me and Kaitlyn pocketed $1.3 million… I just wanted to come out and say those charges are true.”
Investor Regrets and Fallout
Interviews with several investors revealed their deep regrets. One man from Colorado Springs, who was once a close friend of Regalado, expressed how much damage had been done, stating that he had no positive remarks to share. Another investor mentioned investing about $10,000, expressing skepticism about recovering any of the funds. This investor noted that he discovered Regalado’s scheme through his Christian network, acknowledging that he should have conducted more thorough research and felt uneasy about the religious undertones used to foster trust.
A third investor, who has known Regalado since childhood, described her investment as a “family investment” but chose not to disclose the amount. She maintained that no one was coerced into investing, stating, “I just feel the peace of God,” and lamented that the failure of such faith-based endeavors could erode trust in God.
The Role of Religion in the Scheme
Merkle Science, a firm specializing in blockchain analysis, examined evidence from Colorado regulators regarding Regalado’s business. Their CEO, Mriganka Pattnaik, asserted that religion played a significant role in the scheme, suggesting that it was not merely a failed investment but rather a deliberate attempt to exploit individuals for financial gain. Pattnaik indicated that the Regalados lacked the necessary expertise to develop a legitimate cryptocurrency and were likely using the venture to deceive investors.
Civil Rulings Against the Regalados
Currently out on a $100,000 bond, Eli Regalado is scheduled for an arraignment on December 11 in the criminal case. In September, a Denver judge ruled against him and Kaitlyn in a civil lawsuit initiated by the Colorado Securities Commission, determining that they had committed securities fraud. The regulatory agency characterized the Regalados as “21st-century false prophets,” utilizing modern cryptocurrency technology to execute a traditional scam against their own followers and others. The judge imposed a $3.3 million judgment against them and other defendants involved.
Nicole Brown condemned Regalado as a “snake oil salesman,” emphasizing that his actions were solely for personal gain. She expressed sympathy for those who fell victim to his scheme, wishing for him to face severe consequences for his actions.
