Shan Hanes, the former CEO of Heartland Tri-State Bank in Elkhart, Kansas, has been sentenced to more than 24 years in prison for embezzling $47 million from the bank and sending it to cryptocurrency wallets controlled by scammers who tricked him with a “Pig butchering” scheme.
NBC News reports that Shan Hanes, the former CEO of Heartland Tri-State Bank in Elkhart, Kansas, has been sentenced to 293 months in prison for looting the bank of $47 million in a cryptocurrency scam known as “pig butchering.” The massive embezzlement led to the collapse and FDIC takeover of the small Kansas bank, one of only five U.S. banks that failed in 2023.
Hanes, 53, fell victim to the scam in late 2022, which convinced him to invest in supposedly legitimate virtual currency investment opportunities. The scammers, whose true identities remain unknown, communicated with Hanes through the messaging app WhatsApp. Initially using personal funds to buy cryptocurrency, Hanes soon began stealing from various sources, including a local church, an investment club, his daughter’s college savings account, and the bank itself.
Between May and July 2023, Hanes directed 11 wire transfers from Heartland Tri-State Bank to accounts controlled by the scammers, totaling $47 million. He made misrepresentations to bank employees and circumvented the bank’s wire policy and daily limits to execute the transfers. Prosecutors noted that the series of wire transfers followed a common pattern in pig-butchering schemes, where initial investments are followed by requests for additional funds to secure or unfreeze the earlier transfers.
The impact of Hanes’ actions has been devastating for the small community of Elkhart. Many of the bank’s shareholders lost significant portions of their retirement savings, and some are now struggling to afford necessities like nursing home care. Brian Mitchell, Hanes’ former neighbor and a local businessman, recounted how Hanes approached him on July 5, 2023, requesting a $12 million loan to “activate” the funds he had already transferred to the scammers’ accounts. Despite Mitchell’s warnings that he was caught in a scam, Hanes proceeded to wire an additional $12.4 million to the scammers over the next two days.
Hanes was fired from the bank within days of Mitchell’s conversation with a board member, and on July 28, 2023, Heartland Tri-State was closed by the Kansas Office of the State Bank Commissioner and taken over by the FDIC. While depositors did not lose any money, shareholders were wiped out.
During the sentencing hearing, Judge John Broomes imposed a sentence 29 months longer than what prosecutors had requested, noting Hanes’ lack of remorse and intelligent actions. Hanes’ lawyer, John Stang, argued that his client had been “the pig that was butchered” and that his vulnerability to the scam caused him to make bad decisions.
U.S. Attorney Kate Brubacher emphasized the severity of Hanes’ betrayal, stating that his greed knew no bounds and that his illegal schemes jeopardized confidence in financial institutions.
Read more at NBC News here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
