Investors can speak at Gearhart’s trial

May 29, 2015

Victims of the financial fraud of former North County developer Kelly Gearhart will have a chance to speak at his sentencing hearing on June 1 in Los Angeles.

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.

Even though Gearhart defrauded hundreds of victims , the government based its case on several frauds including Gearhart’s largest, his Vista Del Hombre project in Paso Robles. As such, any investor in the Vista Del Hombre project will be permitted to address the court on Monday.

Gearhart recently requested a continuance for an evidentiary hearing. During an evidentiary hearing, the government would prove certain facts in support of the 135 months sentence it seeks and Gearhart would introduce evidence in support of the 57 months’ imprisonment sentence he seeks.

On Monday, federal prosecutors will argue over the number of Gearhart’s victims. Prosecutors contend Gearhart had over 250 victims while the probation department says there were only 17 victims. The probation department considered only investors Gearhart spoke directly with as victims.

The Court intends to proceed with the sentencing as scheduled on June 1 at 11 a.m. in courtroom 11 at the United States Courthouse at 312 N. Spring Street in Los Angeles. Then, the Court will decide whether to hold an evidentiary hearing, which would occur on June 29 at 1:30 p.m.

So, it is unclear whether the sentence will be pronounced on June 1 or June 29, though victims will be permitted to speak on June 1.