Crystal Lake man guilty in $8m Ponzi scheme is now charged with theft using veteran group debit card

A Crystal Lake man who has pleaded guilty in a multimillion Ponzi scheme in federal court has been arrested in McHenry County for allegedly using a veterans group’s debit card for personal expenses totaling more than $10,000, according to the McHenry County State’s Attorney’s Office in a criminal complaint.

Alan J. Hanke, 60, of the 4100 block of Wyndwood Drive, Crystal Lake, was charged Wednesday with theft by deception and using a debit card with intent to defraud, court records show. If found guilty of the two felonies, Hanke could face up to 10 years in prison.

The criminal complaint alleges Hanke “used the Sons of the American Legion’s debit card to make cash withdrawals and purchases totaling over $10,000″ and used the card for “numerous unauthorized cash withdrawals and purchases at various restaurants and retail establishments/online websites” in excess of $150 in a six-month period. The alleged crimes happened for over a year, between January 2023 and March 2024, according to the complaint. The records don’t specify the American Legion chapter allegedly victimized.

In June, Hanke pleaded guilty federal court in Brooklyn to defrauding investors of more than $8 million, and to filing to bankruptcy in an attempt to conceal his crimes, according to the U.S. Attorney’s Office. Hanke, the sole member of his company IOLO Capital, had been arraigned in February in a nine-count indictment on charges of securities fraud conspiracy, wire fraud conspiracy, money laundering conspiracy, wire fraud, bankruptcy fraud and filing a false bankruptcy declaration. He initially pleaded not guilty.

Sentencing for the federal case is set for Oct. 31, according to court documents.

On the new charges, filed in county court, Hanke was released from McHenry County jail Friday with pretrial conditions that prohibit him associating with anyone at the American Legion and the Sons of the American Legion. Hanke can travel to New York for court appearances for his federal case and is allowed to travel to Walworth, Wisconsin, for “medical treatment for his condition,” which was not specified in documents, according to court records.

Hanke has been involved in veterans charities and fundraisers in McHenry County. His next McHenry County court appearance is set for Oct. 11, according to court records. He does not have a lawyer on the local charges listed in court records.