Cryptocurrency scam sends former bank CEO to prison for detonating a bank

A former bank CEO has been sentenced to 24 years in prison for causing the collapse of a bank through a cryptocurrency scam that cost nearly $50 million.

Cryptocurrency scam sends former bank CEO to prison for detonating a bank
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Tech and Science Editor
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Scams come in all different shapes and sizes, but one technique is particularly frightening and that's called "pig butchering," which involves an individual spending a long time developing a relationship with their victim only to eventually present them with a "business" opportunity that ruins them financially.

Cryptocurrency scam sends former bank CEO to prison for detonating a bank 565616556

It's perhaps one of the cruellest forms of scamming someone as it involves developing trust with a person through a perceived genuine relationship. Unbeknownst to the victim, that trust is then shattered after the scammer runs away with their money. 53-year-old Shan Hanes, former CEO of Heartland Tri-State Bank in Elkhart, Kanas fell for this type of scam and has been sentenced to 24 years in prison for illegally wiring $47.1 million that led to the collapse of the bank.

The eleven transactions that Hanes made between May and July 2023 resulted in investors of the bank losing $9 million, which forced the Federal Deposit Insurance Corporation (FDIC) to absorb the $47 million loss and seize the bank. Some customers of the bank lost nearly all of their retirement funds, which funnily enough was also Hanes, who lost all of his embezzlement money.

"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 quick, 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

So, how did this happen? The pig butchering scheme works by securing a first investment from a victim, and then is followed up by multiple requests for additional funds to "secure" or "guarantee" previous investments will pay off. This would be considering the "butchering" phase of the scheme.

In Hanes' situation, the former bank CEO initially invested thousands with his own money. He then eventually began stealing from local organizations and his daughters college fund. It eventually led to nearly $50 million being transferred from the bank despite Hanes being warned he was being scammed.

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NEWS SOURCE:techspot.com

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Jak joined the TweakTown team in 2017 and has since reviewed 100s of new tech products and kept us informed daily on the latest science, space, and artificial intelligence news. Jak's love for science, space, and technology, and, more specifically, PC gaming, began at 10 years old. It was the day his dad showed him how to play Age of Empires on an old Compaq PC. Ever since that day, Jak fell in love with games and the progression of the technology industry in all its forms.

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