Courtroom cheers as FBI returns life savings stolen by former Kansas bank CEO duped in elaborate cryptocurrency scam
WICHITA, Kansas (AP) — Relief swept through a federal courtroom on Monday as victims of a multi-million-dollar embezzlement scheme by a former Kansas bank CEO learned that the FBI had managed to recover their stolen funds. For many, this marked the return of life-altering sums of money that had been swept away in a devastating scam.
“I just can’t describe the weight lifted off of us,” said Bart Camilli, 70, who, along with his wife Cleo, discovered they would recover nearly $450,000. “It’s life-changing.” Camilli had been building his retirement savings since he was 18, starting with his first IRA account. He, like dozens of others, had entrusted his savings to Shan Hanes, the former CEO of Heartland TriState Bank, only to have it vanish in a fraudulent investment scheme.
Hanes, sentenced in August to 24 years in prison, had embezzled $47 million from customer accounts and funneled the money into cryptocurrency investments through a scheme known as “pig butchering.” Prosecutors said the scheme convinced victims to invest all their funds, only for the money to disappear. Hanes lost an additional $40,000 from his church, $10,000 from an investment club, and $60,000 from his daughter’s college fund, ultimately losing over $1 million of his own money as well.
With Heartland TriState Bank drained of its assets, federal regulators stepped in, shutting down the bank and selling it to another institution. The Federal Deposit Insurance Corporation (FDIC) covered customers’ savings and checking accounts, amounting to $47.1 million in insured losses. But the FDIC’s reimbursement did not cover 30 shareholders, including close friends and family, who collectively lost $8.3 million.
During Hanes’ sentencing, devastated shareholders branded him a “deceitful cheat and a liar” and “pure evil.” Many had poured their life savings into the rural bank that Hanes helped found, relying on his assurances and his standing in the community. Margaret Grice, a shareholder in court on Monday, had anticipated receiving only a small fraction of her loss. Instead, she was astonished to learn she would recover nearly $250,000—her entire 401(k). “I’m just really thrilled,” she said. “I can breathe.”
According to court records, Hanes’ downfall began in late 2022 when he was introduced to cryptocurrency by an anonymous contact on WhatsApp. What started as a $5,000 investment quickly spiraled out of control. Believing he was on the cusp of an enormous return, Hanes transferred $47.1 million from customer accounts over an eight-week period. He even watched as his supposed returns appeared to balloon to over $200 million on a fabricated website.
“From the deepest depth of my soul, I had no intention of ever causing the harm that I did,” Hanes said during an earlier sentencing. “I’ll forever struggle to understand how I was duped and how what I thought was just getting the money back was making it worse.”
His attorney, John Stang, offered insight into Hanes’ motives, explaining that he had intended to reclaim the stolen funds and return them to the bank. “He was to take some of the money, and the rest of the money was supposed to go back to the bank,” Stang explained. “Now it’s fiction, it didn’t exist. We all know that now… It failed big time.”
Federal Reserve investigators noted that Hanes’ respected role in the small town of Elkhart, Kansas, population 2,000, had allowed him to evade suspicion for so long. He had served on the local school board, volunteered as a swim meet official, and held a directorship with the American Bankers Association. In recent years, he had even testified before Congress on the importance of local banks in farming communities.
On Monday, prosecutors revealed that while the FDIC expects repayment for insurance claims paid to the bank’s customers, Judge Broomes ruled that shareholders who had been financially devastated by the scheme should be repaid first. This decision came with the understanding that Hanes, now 53, would be in his late 70s upon release and unlikely to repay the $47.1 million still owed.
“Mr. Hanes made some very bad choices after being caught up in an extremely well-run cryptocurrency scam,” Hanes and his attorney said in a court filing. Referring to the “pig butchering” scheme that had entrapped him, they added, “He was the pig that was butchered.”
