Former bank executive sentenced to 24 years in prison after stealing $47 million in crypto scam to unlock returns in 'pig slaughter' scam

Former bank CEO from Kansas, Shan Haneswas sentenced to 24 years in prison for his involvement in a $47.1 million crypto scam involving the slaughter of pigs.

What happened: Hanes, the former CEO of Heartland Tri-State Bankwas convicted of embezzlement. He diverted the bank's funds to crypto accounts controlled by fraudsters, which led to the bank's collapse, NBC News reported.

Hanes was involved in a pig slaughter scam in which he purchased cryptocurrencies to supposedly receive a return on his investments, which he never received.

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Between May and June 2023, Hanes made eleven electronic transfers using the stolen bank funds. He also embezzled money from a local church, an investment club, and his daughter's college savings account.

FDIC-insured Heartland Tri-State Bank was one of five banks to close in 2023.

US Attorney Kate E. Brubacher commented: “Hanes' greed knew no bounds. He violated his professional duties, his personal relationships and federal law.”

“Shan Hanes not only defrauded Heartland Bank and its investors, but also undermined trust in financial institutions with his illegal activities,” Brubacher said.

Why it is important: Scams related to the slaughter of pigs have increased significantly in recent years, with victims losing more than $75 billion worldwide, Time reported in February, citing a study.

In these scams, the scammer typically builds a relationship – often romantic – with the victim before luring them into a series of crypto investments.

Hanes' conviction comes amid a rise in crypto scams. In early August, the Securities and Exchange Commission (SEC) filed charges against NovaTech Ltd. for defrauding over 200,000 investors worldwide of over $650 million worth of crypto assets.

Previously, the Federal Bureau of Investigation (FBI) had also issued a warning about a growing trend of scammers posing as employees of cryptocurrency exchanges to defraud unsuspecting victims.

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Disclaimer: This content was created in part using AI tools and reviewed and published by Benzinga editors.

Photo courtesy: Open Clipart