Ex-CEO of Collapsed Bank Sentenced to Over 24 Years in Prison for Embezzling $47,100,000 in Crypto Scheme: DOJ

The former CEO of a failed bank in Elkhart, Kansas will spend 24 years behind bars after funneling millions of depositors’ money into a cryptocurrency scheme.

The Justice Department says that between May and July last year,  Shan Hanes, who was then serving as CEO of Heartland Tri-State Bank (HTSB), sent a total of $47.1 million of the bank’s funds to a cryptocurrency wallet involved in pig butchering.

The modus is a popular crypto scheme where scammers build relationships with their targeted victims to lure them into making fraudulent investments.

The 53-year-old initiated 11 outgoing wire transfers over the course of the period, funding several cryptocurrency accounts controlled by unidentified third parties.

The DOJ says Hanes’ action ultimately caused the bank to fail and the investors to lose $9 million albeit the Federal Deposit Insurance Corporation (FDIC) absorbed the  $47.1 million loss.

Says U.S. Attorney Kate E. Brubacher,

“Hanes’ greed knew no bounds. He trespassed his professional obligations, his personal relationships, and federal law. Not only did Shan Hanes betray Heartland Bank and its investors, but his illegal schemes also jeopardized confidence in financial institutions.”

The Consumer Financial Protection Bureau, which reviewed the losses, says HTSB had about $139 million in assets before it failed in 2023. The agency also raised the alarm about similar schemes that could compromise financial institutions.

“We are recommending that the Board raise awareness among banks of cryptocurrency scams and train examiners on such scams and relevant preventive and detective controls at banks.”

Hanes was sentenced on Monday after pleading guilty to one count of embezzlement by a bank officer.

Don’t Miss a Beat – Subscribe to get email alerts delivered directly to your inbox

Check Price Action

Follow us on X, Facebook and Telegram

Surf The Daily Hodl Mix

&nbsp

Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

Generated Image: Midjourney

The post Ex-CEO of Collapsed Bank Sentenced to Over 24 Years in Prison for Embezzling $47,100,000 in Crypto Scheme: DOJ appeared first on The Daily Hodl.