Summary:
$47.1 million cryptocurrency scheme leads to restitution for investors
Federal judge orders restitution after Kansas bank collapse
Shan Hanes, former CEO sentenced to 293 months for embezzlement
Investors lost approximately $9 million due to fraudulent transfers
FBI recovers $8 million linked to the fraud
Overview
Millions of dollars seized by the government from a $47.1 million cryptocurrency scheme will be allocated to investors who faced financial losses.
Court Ruling
A federal judge has ordered the restitution following the case that led to the failure of a Kansas bank.
Sentencing of Shan Hanes
In August 2024, Shan Hanes, 53, of Elkhart, was sentenced to 293 months in prison after pleading guilty to embezzlement as a bank officer.
The Scheme
As the CEO of Heartland Tri-State Bank (HTSB), Hanes initiated wire transfers of bank funds to a cryptocurrency wallet belonging to third parties, which resulted in a loss of approximately $9 million for bank investors.
Recovery Efforts
The FBI managed to recover $8 million linked to the fraud.
Statement from U.S. Attorney
U.S. Attorney Kate E. Brubacher stated, “The U.S. Attorney’s Office – District of Kansas thanks the FBI for its diligent investigations that led to the discovery and recovery of over $8 million in stolen funds. Through Hanes’ conviction and prison sentence, the Department of Justice obtained justice for the victims, and now with this court order, those victims will receive some financial relief.”
Investigation Team
The case was investigated by the FBI, FDIC-OIG, FRB-OIG, and FHFA-OIG.
Assistant U.S. Attorney Aaron Smith was responsible for prosecuting the case.
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