Plea agreement reached in Hurst Financial fraud case

September 16, 2011

Kelly Gearhart and James Miller

By KAREN VELIE

A former Atascadero lender has agreed to plead guilty to charges of swindling as many as 1,200 investors out of more than $100 million in a fraudulent investment scheme, according to the court docket.

James Hurst Miller and federal prosecutors agreed to a plea agreement on August 19. The court then filed the agreement under seal.

On August 18, the U.S. attorney’s Los Angeles office filed federal fraud and money laundering charges against Miller, the former head of Hurst Financial Inc. However, they did not take Miller into custody.

A 2008 CalCoastNews investigation revealed James Hurst Miller and former North County developer Kelly Gearhart allegedly bilked more than 1,200 people, primarily senior investors, out of much of their life’s savings.

If the court convicted Miller on all four counts — mail fraud, wire fraud, money laundering and making a false statement to a bank — he would face a maximum sentence of 80 years in federal prison.

Under an alleged plea agreement discussion discovered by CalCoastNews in April, Miller had agreed to testify against other persons being investigated by the FBI. In return, Miller was requesting prosecutors reduce the four counts to one and allow him to serve a reduced prison sentence in the minimum-security federal correction facility located in Lompoc Calif.

During a hearing on Monday, Miller relinquished his passport and secured his release through a $25,000 bond.

U.S. District Judge Otis D. Wright II has not yet set a date to hear the guilty plea.


29 Comments

  1. oto says:

    Hey, “stringers!” I gotta’ tell you, I just revisted all the articles and blogs related to the Kelly Gearhart/Real Estate/Banking fraud subject, and just the bloggers’ alone, not to mention the information in the articles, are enough to investigate! I mean, there are real facts there to be followed up on! So, anyone who has spare time on their hands, and doesn’t mind doing a little drudge work to solidify and verify facts, could really assist those whose money was taken.

    The first step is to invest in PACE, which is the online access to court files in the Federal and state courts. That is to say, if you are willing to fill out a one page form and give them your credit card number, you can get online access to the court papers that have been filed in these cases, and you can print them out. The courts charge money for this, of course, but the last time I checked (a couple of years ago….) it was eight cents a page. This saves driving to the District Court in L.A., for example, to read the case file. You can also check state courts in other states to see if a party or witness has other case files available to look at. This is just a suggestion, in case you are interested.

    Better known, published cases can often be found online for free, as I’m sure you already know. We oughtta’ start a non-profit to keep the toner and paper flowing for the Gearhart victims and call it “The Cal Coast Bloggers Union!” Who needs money when your right!?….Well, a little could help, just to keep the presses rolling and the Web space up and running….Keep it up, you Cal Coast Reporters Extraordinaire: Karen Velie, Dan Blackburn, Lisa Rizzo and the other “bulldog news” gatherersat the CCC.

    Like or Dislike: Thumb up 2 Thumb down 2

  2. Harlow says:

    Amongst numerous other things…we as the “victims”, need to demand that all of these agreements and names be made a matter of Public Record and NOT SEALED!!

    Like or Dislike: Thumb up 21 Thumb down 1

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