A former Chief Executive Officer of a Kansas-based bank has been sentenced to over 24 years in prison following a $47 million crypto fraud that crippled the bank.
Shan Hanes the former CEO of the now-defunct Heartland Tri-State Bank has been sentenced to 293 months in prison after court discovered that he embezzled millions of dollars leading to his bank’s collapse.
In an Aug 19 press release, The US attorney in Kansas said that Hanes who pleaded guilty to the offense orchestrated a Pig butchering scheme that saw him carry out over a dozen wire transfers totaling more than $47 million from Heartland Tri-State Bank to a crypto wallet between May and July 2023.
The US attorney on the case bemoaned Hanes’s unprofessional conduct while lamenting the betrayal of customer trust portrayed by Hanes with his actions.
“Hanes’ greed knew no bounds. He trespassed on 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,”
Today’s sentence is a measure of justice for the victims, and a statement that the U.S. Department of Justice will hold those accountable who violate positions of trust for their own gain.” said U.S. Attorney Kate E. Brubacher.
The Special Agent in charge of the FBI Kansas City Field Office reacted to the court sentencing stressing Hanes illicit activity was his idea of a get-rich-quick scheme which ultimately led to the collapse of his bank.
“Mr. Hanes, as the CEO of Heartland Tri-State Bank, held the trust and confidence of the community of Elkhart, KS, but he violated that trust. He attempted to benefit financially by embezzling funds from the bank. His idea to get rich quickly, in all reality, was a pig butchering scheme. His involvement in this scheme ultimately led to the bank’s collapse. His job, the bank’s job was to protect its customers and identify fraudulent scams — not to participate in them,” said Special Agent in Charge Stephen Cyrus of the FBI Kansas City Field Office.
The Heartland Tri-State Bank was insured by the Federal Deposit Insurance Corporation. They absorbed the $47.1 million loss caused by Hanes ‘pig Butchering scheme.
The illicit activity led to the collapse of the bank and also cost its investors $9 million.
What to Know
- A pig butchering scam, a.k.a. “Sha Zhu Pan” or Shazhupan, translated as Killing Pig Plate, is a type of long-term scam and investment fraud in which the victim is gradually lured into making increasing contributions, usually in the form of cryptocurrency, to a fraudulent cryptocurrency scheme.
- Shan Hanes was sentenced to approximately 293 months of jail time.