DOJ Ties Kansas Bank Collapse to $225 Million 'Pig Butchering' Seizure
A Kansas banker who looted millions from his small-town bank in 2023, which triggered its collapse, lost much of the money to overseas crypto scammers targeted in a record-breaking DOJ bust, according to a complaint filed Wednesday.
Prosecutors have filed a civil forfeiture action targeting over $225 million in laundered USDT, part of a butchering scam with ties to a Philippines call center that ensnared Shan Hanes, the disgraced former CEO who embezzled $47 million from Heartland Tri-State Bank, a theft which was directly attributed to the agricultural lender's demise in 2023.
According to the Department of Justice complaint, OKX, a crypto exchange, provided key information that helped identify an intricate network of accounts on the exchange used to launder the crypto proceeds.
Scammers laundered funds by first directing victims to send USDT to 93 scam-controlled deposit addresses. From there, the funds were routed through as many as 100 intermediary wallets in a process designed to obscure the source of funds and mix deposits from multiple victims, according to the complaint.
These laundered funds were then funneled into 22 primary OKX accounts and further shuffled across 122 additional OKX accounts, all linked by shared IP addresses, reused KYC documents, and coordinated behavior allegedly traced to a Manila-based scam compound, which the complaint names as ITECHNO Specialist Inc.
In total, the DOJ says that approximately $3 billion in transaction volume was generated by this laundering network.
In total, the DOJ says there were 434 victims and has identified 60 of them who lost a combined $19.4 million.
The largest of these victims was Hanes, with the DOJ identifying $3.3 million of the $47 million he embezzled in this seizure.
Hanes embezzled the money between May 30, 2023, and July 7, 2023, according to both the DOJ complaint and the Federal Reserve's report into the collapse of Heartland Tri-State Bank, one of the banks to collapse in the aftermath of the 2023 U.S. banking crisis.
During this six-week period, Hanes initiated 10 wire transfers totaling approximately $47.1 million from Heartland Tri-State Bank, a small community lender focused on agricultural loans, to a crypto wallet he controlled.
These wire transfers occurred between the bank's quarterly regulatory reporting periods, allowing the activity to go initially undetected.
At the time, Heartland was well-capitalized with $13.7 million in capital and $139 million in assets, but Hanes' actions depleted its liquidity, triggered $21 million in emergency borrowing, and left the bank with a $35 million capital hole, forcing regulators to shut it down in July 2023.
According to prior reporting from CNBC, Hanes also stole $40,000 from the Elkhart Church of Christ, $10,000 from the Santa Fe Investment Club, $60,000 from his daughter's college fund, and liquidated nearly $1 million in stock from a firm called Elkhart Financial to send to pig butchering scammers.
He was sentenced to 24 years in prison in August 2024.
The DOJ complaint referred to him as both a perpetrator and a victim.
Crypto seized by the U.S. government, such as in this case, is likely to be earmarked for a not-yet-established stockpile ordered by President Donald Trump.
The bitcoin BTC reserve and the stockpile of other cryptocurrencies haven't yet been formally established, but the Treasury Department has been leading an audit of governmental digital asset holdings to determine what needs to be gathered.
Once established, the long-term crypto holdings will likely put seized bitcoin in one fund and other types of tokens in another.
The holdings in this case appear to be in significant amounts of USDT, according to the filing. It's unclear what funds may eventually be returned to victims, as only a relatively small percentage of those directly harmed have been identified.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Motor 1
8 minutes ago
- Motor 1
The 20 Most American-Made Cars of 2025
With tariffs still a hot talking point and prices expected to increase over the next few months, it could make a big difference where your next car is built. That's why the annual American-Made Index is an important tool to use when shopping for your next ride. The American-Made Index uses five different factors to determine just how "American" each car sold in the US is: Location of final assembly, percentage of US and Canadian parts, countries of origin for all engines, countries of origin for all transmissions, and US manufacturing workforce. This year, the study analyzed more than 400 vehicles and narrowed the final list down to 100 models. At the top of the list are the usual suspects: Tesla, Jeep, and even Honda. American brands like Chevrolet and Ford don't crack the top 10, and only one Chevy makes it in the top 20. You can read the full list at —but here's what the top 20 looks like: 20. Nissan Pathfinder 19. Chevrolet Colorado 18. Toyota Corolla Cross Hybrid 17. Kia Sportage 16. Acura Integra 15. Honda Accord 14. Acura RDX 13. Jeep Wrangler 12. Honda Pilot 11. Acura MDX 10. Volkswagen ID.4 9. Honda Passport 8. Honda Odyssey 7. Honda Ridgeline 6. Kia EV6 5. Jeep Gladiator 4. Tesla Model X 3. Tesla Model S 2. Tesla Model Y 1. Tesla Model 3 Tesla Tops the Charts Tesla Model 3 Performance As expected, Tesla tops the list with four of its models taking the top four. The Model 3 earns the crown as the most American-made vehicle of 2025 (so far). All of Tesla's vehicles are produced at its Fremont Factory in Fremont, California, with the Gigafactory in Texas also producing Model Ys and Cybertrucks. The Gladiator takes fifth place and is the only Jeep in the top 20, while Kia takes sixth place with the electric EV6. The Kia Sportage also cracks the top 20 in 17th place; both Kia models are produced at the brand's West Point, Georgia, manufacturing facility. Honda has five vehicles in the top 20, with the Odyssey, Pilot, Ridgeline, and Passport all produced at the same manufacturing plant in Lincoln, Alabama. The Honda Accord, meanwhile, is built in Marysville, Ohio. Honda's luxury brand, Acura, also has three vehicles in the top 20: The RDX, MDX, and Integra. The Integra is built alongside the Accord in Marysville, while the RDX and MDX are produced nearby in East Liberty, Ohio. Where Are Chevy & Ford? Chevrolet Colorado ZR2 Bison Photo by: Andrew Link | Motor1 While only one of Detroit's Big Three cracks the top 10 (Jeep), Chevy and Ford are nowhere to be found. Only one Chevy model—the Colorado pickup, at 19th—even cracks the top 20. It's produced at Chevy's Wentzville, Missouri, plant. The Ford F-150 Lightning comes in at 22nd, and the Explorer is 23rd. Meanwhile, the Bronco falls all the way to 47th, while the Mustang is even further still at 56th. Outside of the Colorado, the C8 Corvette is 29th, the Suburban is 38th, the Tahoe is 41st, and the Traverse SUV is 73rd. A few Cadillac and GMC models—like the Yukon at 39th and the CT5 at 44th—do at least crack the top 50. The Least-American Made Subaru Crosstrek Hybrid Photo by: Subaru On the opposite end of the spectrum, a handful of vehicles from American brands fall to the bottom of the list. The Jeep Wagoneer L is the 100th most American-made car of 2025. The Toyota RAV4 Hybrid is 99th, the Cadillac Lyriq is 98th, the Nissan Rogue is 97th, the Subaru Crosstrek is 96th, and the Genesis GV70 is 95th. Here's what the bottom 10 looks like: 100. Jeep Wagoneer L 99. Toyota RAV4 Hybrid 98. Cadillac Lyriq 97. Nissan Rogue 96. Subaru Crosstrek 95. Genesis GV70 94. Honda Civic Hybrid 93. Mercedes-Benz GLE350 92. Mercedes-Benz EQE 350+ 91. Mercedes-Benz GLS450 90. Mercedes-Benz GLE450e Some Cars Are More American Than You Think The Honda Ridgeline Is More American Than Your Ford or Chevy Truck Honda Ridgeline, Toyota Tundra More American-Made Than F-150, Silverado: Study Get the best news, reviews, columns, and more delivered straight to your inbox, daily. back Sign up For more information, read our Privacy Policy and Terms of Use . Source: Share this Story Facebook X LinkedIn Flipboard Reddit WhatsApp E-Mail Got a tip for us? Email: tips@ Join the conversation ( )
Bloomberg
12 minutes ago
- Bloomberg
Fallout From the Fed Decision
Sonali Basak highlights the market-moving news you need to know. Today's guests: Columbia Threadneedle Global Rates Strategist Ed Al-Hussainy, Guggenheim Fixed Income CIO Steven Brown, BNP Paribas Head of US Credit Strategy Meghan Robson, and PIMCO Portfolio Manager of Multi-Sector Credit Sonali Pier. (Source: Bloomberg)
Bloomberg
12 minutes ago
- Bloomberg
Meta Launches $399 Oakley AI Glasses
Bloomberg Intelligence's Mandeep Singh discusses Meta's move to roll out new smart glasses models with Oakley. He joins Caroline Hyde on 'Bloomberg Tech.' (Source: Bloomberg)
