<![CDATA[<figure class="image"><img src="https://cimg.co/news/125691/331850/robert-bye-jef-vyxytb4-un.jpg" srcset="https://cimg.co/news/125691/331850/responsive-images/robert-bye-jef-vyxytb4-un___media_library_original_1920_1280.jpg 1920w, https://cimg.co/news/125691/331850/responsive-images/robert-bye-jef-vyxytb4-un___media_library_original_1200_800.jpg 1200w, https://cimg.co/news/125691/331850/responsive-images/robert-bye-jef-vyxytb4-un___media_library_original_900_600.jpg 900w, https://cimg.co/news/125691/331850/responsive-images/robert-bye-jef-vyxytb4-un___media_library_original_720_480.jpg 720w, https://cimg.co/news/125691/331850/responsive-images/robert-bye-jef-vyxytb4-un___media_library_original_600_400.jpg 600w, https://cimg.co/news/125691/331850/responsive-images/robert-bye-jef-vyxytb4-un___media_library_original_300_200.jpg 300w" width="1920" class="content-img" alt=""><figcaption>Image Source: Unsplash</figcaption></figure>Heartland Tri-State Bank, a community bank in Elkhart, Kansas, has been forced to shut down after its CEO,&nbsp;Shan Hanes, lost millions of dollars in a cryptocurrency scam.&nbsp;The incident unfolded on July 5 when Hanes, desperate to retrieve his money from a supposed cryptocurrency investment, approached one of his wealthy clients with a peculiar request, according to a&nbsp;<a href="https://www.bloomberg.com/news/articles/2023-09-27/crypto-scam-led-to-demise-of-heartland-tri-state-bank">recent report from Bloomberg</a>.Per the report, the banker asked the client to lend him $12 million, promising to repay the loan with an additional $1 million in interest after just 10 days.&nbsp;Hanes said he was investing in crypto with the help of someone else and claimed that there were some wire payment issues, which needed an infusion of more funds.The client, a local farmer, ultimately declined to provide the loan, suspecting it to be a crypto scam.&nbsp;He even reportedly advised Hanes to go to Hong Kong in order to recover the money.However, after discovering that Hanes had indeed wired the $12 million, the farmer took the matter to a member of Heartland's board.Consequently, the Kansas Office of the State Bank Commissioner launched an investigation into the bank and declared it insolvent on July 28.The closure of Heartland Tri-State Bank has sent shockwaves through Elkhart, a tight-knit community where the bank played a vital role.&nbsp;As one of only two banks in town, Heartland was deeply embedded in the fabric of the community, sponsoring local events and providing financial assistance to those in need.&nbsp;<h2 id="fdic-estimates-heartland-s-loss-at-54-million">FDIC Estimates Heartland's Loss at $54 Million</h2>The Federal Deposit Insurance Corp. (FDIC), which was appointed as the bank's receiver, has estimated a loss of $54 million from its insurance fund to protect depositors.&nbsp;The substantial loss is an indication of the severity of the situation, given that Heartland had total assets of only $139 million.&nbsp;Shareholders, including Hanes and his family, face the possibility of losing their investments as the bank's stock was owned by a separate holding company.The incident has also drawn the attention of law enforcement agencies.&nbsp;FBI agents have been conducting investigations, questioning community leaders with ties to the bank.&nbsp;The FBI, however, has neither confirmed nor denied the existence of an investigation.&nbsp;<h2 id="exact-details-of-the-crypto-scam-remain-unclear">Exact Details of the Crypto Scam Remain Unclear</h2>The exact details of the crypto scam that ensnared Hanes remain unclear.However, a warning issued by the US Department of the Treasury's Financial Crimes Enforcement Network suggested that it was probably a pig butchering scam.&nbsp;Meanwhile, Hanes has not been accused of any wrongdoing.He has resigned from his positions on the school board and the Kansas Bankers Association and is awaiting the outcome of the ongoing investigation.The collapse of Heartland comes as four major US lenders have failed so far this year, including&nbsp;<a href="https://cryptonews.com/news/breaking-news-crypto-friendly-silvergate-bank-announces-voluntary-liquidation-a-blow-for-crypto-adoption.htm">Silvergate Bank</a>,&nbsp;<a href="https://cryptonews.com/news/another-bank-down-crypto-friendly-signature-bank-closed-over-systemic-risk-concerns-what-does-this-mean-for-crypto.htm">Signature Bank</a>,&nbsp;<a href="https://cryptonews.com/news/hsbc-acquires-silicon-valley-bank-uk-for-ps1-safeguard-customers-taxpayers-whats-going-on.htm">Silicon Valley Bank</a>, and First Republic Bank.Among these banks, the failure of Silvergate and Signature was&nbsp;<a href="https://cryptonews.com/news/bank-execs-face-senate-ire-for-blaming-bank-collapse-crypto-while-amassing-millions.htm">partly related</a>&nbsp;to the 2022 crypto meltdown.&nbsp;
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Local US Bank Shut Down after CEO Lost Millions in Crypto Scam

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