A Kansas banker who looted millions from his small Bybank in 2023, which triggered his collapse, lost much of the money to overseas crypto fraudsters who were targeted in a record-breaking doj-bust, according to a complaint on Wednesday.
Prosecutors have lodged a civil forfeiture of action aimed at over $ 225 million in laundering USDT, part of a slaughter fraud with a Filipiner’s CallCenter offering Shan Hanes, the quarreled former CEO, who initiated $ 47 million from Heartland Tri-State Bank, a theft directly complained to the agricultural launch in 2023.
According to the Department of Justice complaint, OKX provided a crypto exchange, key information that helped identify a complicated network of accounts on the exchange used to launder the crypto.
Scammers laundered funds by first instructing the victims to send usd to 93 fraud-controlled deposit addresses. From there, the funds were directed through as many as 100 mediating wallets in a process designed to hide the source of funds and mix deposits from several victims, according to the complaint.
These laundering funds were then funneled for 22 primary OKX accounts and further mixed across 122 additional OKX accounts, all linked by shared IP addresses, recycled KYC documents and coordinated behavior allegedly traced to a Manila-based fraud connection, which the complaint names as ITECHNO specialist Inc.
In total, Doj says that approx. $ 3 billion in transaction volume was generated by this laundering network.
Biggest victims
In total, DOJ says there were 434 victims and have identified 60 of those who lost a total of $ 19.4 million.
The largest of these victims was Hanes, where DOJ identified $ 3.3 million of the $ 47 million he submitted in this seizure.
Hanes underlying the money between May 30, 2023 and July 7, 2023, according to both the DOJ complaint and the Federal Reserve’s report on the collapse of Heartland Tri-State Bank, one of the banks to collapse in the wake of 2023 US Banking Crisis.
During this six-week period, HANE’s 10 wiring transfers launched a total of approx. $ 47.1 million from Heartland Tri-State Bank, a small social lender that focused on agricultural loans, to a crypto-design book he controlled.
These thread transfers occurred between the bank’s quarterly regulatory reporting periods, which allowed the activity to go originally undetected.
At that time, Heartland was well -capitalized by $ 13.7 million in capital and $ 139 million in assets, but Hanes’ actions depleted its liquidity, triggered $ 21 million in emergency loans 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 Elkhart Church of Christ, $ 10,000 from the Santa Fe Investment Club, $ 60,000 from his daughter’s college fund, and liquidated almost $ 1 million in stock from a company called Elkhart Financial to send to pigs swirling fraudsters.
He was sentenced to 24 years in prison in August 2024.
The DOJ complaint referred to him both as a perpetrator and a victim.
Seized crypto that is likely to go to fed in the warehouse
Crypto, seized by the US government, such as in this case, is likely to be earmarked for a not yet established stock ordered by President Donald Trump.
Bitcoin
Reserve and storage of other Cryptocurrencies has not yet been formally established, but the Treasury Department has conducted a revision of the state digital asset portfolio to determine what is to be collected.
Once established, the long -term crypto attitudes will probably put Bitcoin seized in one fund and other types of tokens in another.
The herds in this case appear to be in significant amounts of USDT, according to archiving. It is unclear what funds can eventually be returned to the victims, as only a relatively small percentage of those directly injured have been identified.
