Ex-Kansas Banker Charged for Embezzling Millions Via Crypto Scheme

2024-08-19 23:07:35

Crypto fraud pig butchering

Shan Hanes embezzled tens of millions of dollars in a crypto scheme, causing Heartland Tri-State Bank to collapse. Last updated:

August 20, 2024 03:07 EDT

Author

Sujha Sundararajan

Author

Sujha Sundararajan

About Author

Sujha has been recognised as 🟣 Women In Crypto 2024 🟣 by BeInCrypto for her leadership in crypto journalism.

Author Profile

Copied

Last updated:

August 20, 2024 03:07 EDT

Why Trust Cryptonews With over a decade of crypto coverage, Cryptonews delivers authoritative insights you can rely on. Our veteran team of journalists and analysts combines in-depth market knowledge with hands-on testing of blockchain technologies. We maintain strict editorial standards, ensuring factual accuracy and impartial reporting on both established cryptocurrencies and emerging projects. Our longstanding presence in the industry and commitment to quality journalism make Cryptonews a trusted source in the dynamic world of digital assets. Read more about Cryptonews Ex-CEO of the now-defunct Kansas-based Heartland Tri-State Bank, has been charged for his alleged involvement in a fraud crypto scheme.

Shan Hanes, of Elkhart pleaded guilty to one count of embezzlement, involving tens of millions of dollars in crypto. Apparently, the fraud scheme led the bank to fail at a complete loss of equity to investors, the announcement read.

The U.S. Attorney’s Office at District of Kansas has sentenced Hanes to 24 years in prison for using his former position to commit the fraud.

Per the court documents, the crypto scheme is referred to as “pig butchering.” It involved Hanes creating 11 outgoing wire transfers of Heartland’s funds between May 2023 and July 2023, totaling $47.1 million.

The funds were sent to multiple crypto wallets controlled by unidentified third parties, it added. Further, Hanes’ attempt to benefit financially by embezzling funds from the bank, led to the collapse of Heartland with $9 million loss to investors.

U.S. Attorney Kate E. Brubacher noted that the sentence is a “measure of justice for the victims.” She also stressed that the ruling proves U.S. Department of Justice “will hold those accountable and violate positions of trust for their own gain.”

“Not only did Shan Hanes betray Heartland Bank and its investors, but his illegal schemes also jeopardized confidence in financial institutions.”

Additionally, Korey Brinkman, special-agent-in-charge of FHFA-OIG’s Central Region, assured his agency would continue to “vigorously investigate criminal offenses involving frauds.”

Pig-Butchering Crypto Scheme on the Rise

According to INTERPOL’s Global Financial Fraud assessment released early this year, pig-butchering crypto schemes have been predominantly on the rise.

Additionally, losses from investment scams increased to a new-high of 38% last year, FBI’s Internet Crime report revealed. Some estimates noted that pig butchering scams have netted a whopping $75 billion from the start of 2020 to February of this year.

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.

1 Likes