The ex-CEO of Heartland Tri-State Financial institution in Kansas has been indicted for allegedly diverting $47.1 million from the financial institution’s reserves into cryptocurrency investments.
The Elkhart, Kansas-based establishment’s CEO, Shane Hanes, additionally appeared earlier than Congress a number of occasions to debate the significance of neighborhood banks.
Based on federal courtroom documents, Hanes is accused of large monetary misappropriation from the financial institution and embezzling funds from an area church. The case’s filings additionally revealed {that a} native businessman, Brian Mitchell, was additionally approached by Hanes for a mortgage. The previous CEO talked about that the mortgage was to assist him withdraw funds from a crypto funding.
Bloomberg stories steered Hanes had invested buyer funds from the financial institution and the church since 2022. Finally, the financial institution incurred the main financial loss, forcing it to shut down. Nevertheless, the involvement of the Federal Deposit Insurance coverage Company (FDIC) helped the financial institution return buyer funds, however its operation couldn’t proceed.
Though such scams have been frequent in the previous few years, with Sam Bankman-Fried’s FTX saga nonetheless recent on the minds of crypto fanatics, the incident was outdoors of the norm, given it occurred in a city of simply 1,800 residents.