The former CEO of Heartland Tri-State Bank (HTSB), Shan Hanes, was recently sentenced to 293 months in federal prison for embezzling $47.1 million in a cryptocurrency fraud scheme. Hanes executed 11 unauthorized wire transfers between May and July 2023, directing the bank’s funds to a cryptocurrency wallet in a scheme known as “pig butchering.” This fraudulent activity ultimately led to the collapse of HTSB.
As a result of Hanes’s actions, the Federal Deposit Insurance Corporation (FDIC) absorbed the $47.1 million loss, leaving the bank’s investors with a $9 million hit. The FDIC confirmed that the funds were transferred to multiple cryptocurrency accounts controlled by unidentified third parties, making it impossible for the bank to recover the stolen money. A federal judge has ordered that restitution for the victims be determined at a separate hearing within the next 90 days.
U.S. Attorney Kate E. Brubacher condemned Hanes for his greed, stating that he not only betrayed the bank and its investors but also jeopardized confidence in financial institutions. FBI Special Agent in Charge Stephen Cyrus echoed this sentiment, emphasizing that Hanes exploited his position of trust for personal gain, leading to the bank’s collapse. Korey Brinkman, Special Agent-in-Charge of FHFA-OIG’s Central Region, noted that Hanes’s actions constituted a severe breach of trust and caused significant losses to bank customers.
The sentencing of Shan Hanes serves as a stark reminder of the consequences of greed and betrayal in the financial sector. Hanes’s actions not only led to the downfall of Heartland Tri-State Bank but also damaged the trust and confidence of the community. This case highlights the importance of holding executives accountable for their crimes and sends a clear message that those who compromise the stability of financial institutions will face justice.
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