Victims of Cryptocurrency Scam Awarded Restitution

(KAKE) – After a $47.1 million cryptocurrency scheme caused a Kansas bank to fail, a federal judge ordered during a restitution hearing Monday that millions of dollars seized by the government be divided among investors who suffered financial losses.
In August of this year, 53-year-old Shan Hanes of Elkhart was sentenced to 24 years in prison after pleading guilty to one count of embezzlement by a bank officer. While the CEO of Heartland Tri-State Bank, Hanes initiated outgoing wire transfers of bank funds to a cryptocurrency wallet belonging to third parties. This caused Heartland to collapse, and the bank investors to lose approximately $9 million.

The FBI was able to recover $8 million in funds associated with the fraud.
“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,” said U.S. Attorney Kate E. Brubacher.