Ex-bank CEO sentenced to 24 years for embezzling $47M in crypto scheme

Hanes became the “pig” in a “pig-butchering scheme”– when scammers persuade a victim to invest in what feels like reputable crypto and afterwards keep the money on their own– in late 2022, initially using his very own funds, prosecutors claimed.

On Monday, US District Court John Broomes punished Hanes to 24 years– 29 months much longer than what district attorneys requested after he begged guilty to a single count of embezzlement by a financial institution officer in Might, according to the record.

“He was the pig that was butchered,” Hanes’ attorney John Stang composed. “Mr. Hanes’s susceptability to the Pig Butcher scheme created him to make some really bad choices, for which he is absolutely sorry for creating damages to the financial institution and loss to the Stockholders.”

Former Heartland Tri-State Financial Institution CEO Shan Hanes was duped by scammers in a “pig butchering” plan who persuaded him to send millions of bucks by means of cable transfers with pledges to unlock his returns on crypto investments, federal prosecutors stated.

Hanes came under a pattern of wire transfers as fraudsters told him that each investment needed a brand-new transaction to open the previous investment’s returns– a pattern Hanes exposed when he called his neighbor in a panic prior to 8 a.m. on July 5, 2023, Mitchell told CNBC.

The 53-year-old coordinated a collection of cable transfers over eight years that broke down the Elkhart bank and brought about a FDIC takeover– making it one of just 5 US banks that failed in 2023, according to a CNBC report.

Yet Hanes had actually been embezzling cash from the church, a neighborhood investment club and one of his three child’s college interest-bearing accounts– all of which he lost to the fraudsters, according to court records.

“The initial point he says is, ‘Brian, I need to borrow $12 million for 10 days, and I’ll offer you $1 million for lending it to me,'” Mitchell told CNBC. “I’m sitting there and I claimed, am I in a bank in Elkhart, Kansas, or in an alley with a shylock in Chicago.”

Those Heartland bank employees broke the bank’s very own plans to approve the transfers, according to a report by the Office of the Inspector General of the Board of Governors of the Federal Get System.