Kelly Gearhart gets another reprieve

November 22, 2014
Kelly Gearhart

Kelly Gearhart


The sentencing hearing for former Atascadero developer Kelly Gearhart has been extended from Dec. 29 to Feb. 23. Gearhart faces a statutory maximum of 50 years in federal prison for defrauding investors out of more than $100 million.

In May, Gearhart pleaded guilty to two counts of wire fraud and one count of money laundering in a Los Angeles federal court. Gearhart, 53, admitted that he knowingly and intentionally made misrepresentations and omissions relating to development projects to get people and institutions, including nonprofits, to trust him with their money.

Assistant United States Attorney Stephen Goorvitch asked for the sentencing hearing delay to have more time to determine if any disputed issues can be resolved and to quantify the number of victims and restitution amounts. The judge approved the hearing continuation.

In May, Gearhart plead guilty to three charges in connection with the Vista Del Hombre project. He also agreed to pay restitution to his victims of that scheme of up to $20 million and to be truthful when dealing with the court, the probation department and pretrial services. In exchange, prosecutors dropped 13 of the 16 felony charges.

Kelly Gearhart and James Miller

Kelly Gearhart and James Miller

At that time, Goorvitch said he planned to seek a sentence of 11 years in federal prison. But, United States District Judge Otis D. Wright II is free to sentence Gearhart up to 50 years.

Gearhart and James Miller, the former president of Hurst Financial, defrauded more than 1,200 investors of more than $100 million in an alleged Ponzi scheme. Gearhart bilked investors who put money into Central Coast real estate projects and then siphoned off the monies for other purposes.

Gearhart’s relationships with community leaders in Atascadero and accomplices who included a lender, a title officer and a property appraiser, provided Gearhart with the appearance that he was an upstanding civic-minded citizen when, in fact, he was breaking state and federal laws.

Other than Gearhart and Miller, no one else has yet been charged for their participation in the fraud.

In 2011, Miller agreed to plead guilty to charges of fraud and money laundering in a plea agreement in which the court agreed to grant Miller’s daughter Courtney Brard immunity, according to court records. Miller is scheduled to be sentenced by Judge Wright on Feb. 2.

Gearhart’s questionable financial dealings were brought to light in a lengthy, ongoing series of articles by CalCoastNews starting in 2008.

The developer threatened to sue the news website following the publishing of articles outlining his questionable investment activities in one particular project, the Vista del Hombre golf and business park located on the outskirts of Paso Robles. That lawsuit never materialized, although the website received letters from Gearhart’s attorneys, as well as Gearhart’s personal denial and threats voiced on Dave Congalton’s Home Town radio show on KVEC920.

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  1. Nancimeek says:

    Anymore dumpster diving into Grigger Jones trash which uncovered incriminating evidence? A classic case of a man who thought he was above the law having taken an oath to protect the law and serve in the name of Justice. Scary. Grigger Jones isn’t the only one who has walked the greed path at the expense of others. Taking advantage of a dying manor the families of a dead man is reprehensible.

    (0) 0 Total Votes - 0 up - 0 down
    • Nancimeek says:

      FYI Someone might want to let Grigger Jones know the following: His client,
      Former Palauan native and my stepmother who he defended radically in court, Elizabeth Asanuma Reklai Meek stole my identity in 2008 and opened a credit card account, she is currently being investigated by the Police Department in Hawaii. The address where the card was sent was HER’s and the charges were apparently made by her. Wells Fargo is already going after her for the over $5,000 in charges she made. Any information you can provide is encouraged. Thank you and be sure and let Grigger Jones know that his client was not the sweet innocent person he declared was so innocent. Birds of a feather……..

      (1) 1 Total Votes - 1 up - 0 down
  2. coffeetime says:

    Who was the property appraiser? Are all the other businesses that were in Kelly’s circle of
    deceit still doing business in A town? Creepy and scary.

    (16) 16 Total Votes - 16 up - 0 down
    • BeenThereDoneThat says:

      I can speak for myself as one who did some business with Kelly. I lost TEN’S of thousands of dollars with Kelly. I know of others that did to. Don’t just assume that everyone who had something to do with Kelly made out on this. He lied and screwed us to. Also how would you like to be a business associated with him and you where innocent? Put that on your resume.

      (14) 16 Total Votes - 15 up - 1 down
      • Jorge Estrada says:

        “How would you like to be a business associated with him and you were innocent?”

        Is that a rhetorical question or another admission of #$%&^.?

        (2) 14 Total Votes - 8 up - 6 down
        • BeenThereDoneThat says:

          Well if you got screwed, like I did out of thousands, what do you think the answer is??

          (4) 4 Total Votes - 4 up - 0 down
          • Jorge Estrada says:

            Nobody gets in as deep as Kelly did without the law looking the other way.

            (6) 8 Total Votes - 7 up - 1 down
        • Nancimeek says:

          what about his partner and lawyer Grigger Jones? What is happening with him? I was told he is part of the FBI investigation but haven’t heard anything recently. Still waiting to hear about the $646,000 (exact amount for buy in to Pe Ji Ho Ta Casino) which was taken from our father’s estate by our stepmother and allegedly handed over to grigger Jones as part of an investment. Go to our web site for more information. Our satisfaction comes from all the people who contacted us over the years with horror stories about how Jones tried to do the same thing to their families and were stopped or fired Grigger Jones as their attorney.

          (1) 1 Total Votes - 1 up - 0 down
    • Still Standing says:

      I know David Graves Construction is still building! At least for those that don’t know who and what he really is! He was thick with Kelly and Jay. Used to go to Vegas with the investors money all the time.

      (10) 14 Total Votes - 12 up - 2 down
  3. SandyK says:

    He garnered tons of blind support over the years from red neck A-town city council members…..they let him get away with about anything he wanted…

    (21) 23 Total Votes - 22 up - 1 down
  4. SLOChildrenAtPlay says:

    Am I correct that Gearhart was once a Correctional Officer himself? If so, you can not only count on the fact that he will serve time at some Federal country club like Lompoc BUT he will also be in “protective custody.” I’m also sure his wife will have money hidden away to put on his books so that he can afford every luxury he can while inside.

    While no prison is paradise, Kelly won’t see any harder time than Martha Stewart got. Just maybe longer. The real hell prisons are reserved for murderers, and working people like you or me who might try to cheat on their taxes.

    (23) 23 Total Votes - 23 up - 0 down

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