The former CEO of Heartland Tri-State Bank, Shan Hanes, has been sentenced to more than 24 years in prison after being found guilty of embezzling $47m.
Former Kansas Bank CEO Given 24-Year Prison Sentence For Crypto Scam
Hanes had been duped by cryptocurrency scammers in a ‘pig butchering’ scam where he took money out of the Kansas bank to send to the scammers’ wallets. Federal prosecutors said that the scam appealed to his greed. The embezzlement led to the bank collapsing and being taken over by the Federal Deposit Insurance Corporation (FDIC).
Hanes sent the money to the scammers by wire transfers in an eight-week period, causing Heartland Tri-State Bank to become one of just five American banks to fail in 2023. The US District Court in Wichita heard how Hanes also managed to get hold of funds from the local church and his daughter’s savings account, with the scammers telling him that he needed to send them more cash to get hold of the returns on his original investment.
Don’t miss out the latest news, subscribe to LeapRate’s newsletter
Judge John Broomes passed a sentence amounting to 293 months, with about 30 of the bank’s shareholders attending the court hearing. Hanes was chairman of the Kansas Bankers Association, but in late 2022 he began to make transactions to buy cryptocurrencies after communicating with an unknown contact on WhatsApp.
The prosecutor’s report said that “we believe that the CEO’s dominant role in the bank and prominent role in the community contributed to a reluctance on the part of Heartland employees to question or report the alleged fraudulent activities earlier”. He started with small transfers but was soon wiring millions of dollars each day to the scammers.
