Kelly Gearhart blames lenders, claims he is a victim

June 28, 2015
Kelly Gearhart

Kelly Gearhart


Former North County developer Kelly Gearhart contends that employees of Heritage Oaks Bank and Hurst Financial were primarily responsible for defrauding more than 1,200 investors out of more than $100 million. The prosecution argues that Gearhart lulled the victims through misinformation and as such is responsible for their losses.

In 2014, Gearhart, now 55, pled guilty to bilking investors who put money into Central Coast real estate projects in an agreement that reduced the maximum sentence allowable by law from 300 years to 50 years in federal prison. Instead of developing the properties, Gearhart spent the money on his and his wife Tamara Gearhart’s extravagant lifestyle.

Even though Gearhart defrauded more than 1,000 victims, the government based its case on only several frauds including Gearhart’s largest, his Vista Del Hombre project in Paso Robles, And as such, Gearhart believes the court should consider only 18 victims when handing down his sentence.

During an evidentiary hearing on Monday at 1:30 p.m., the government plans to ask for a 135 months sentence and Gearhart will introduce evidence in support of the 57 months’ imprisonment sentence he seeks. Nevertheless, the court can elect to charge Gearhart with the maximum, 50 years in federal prison.

The prosecution contends that Gearhart falsely re-conveyed loans in order to secure a loan from Heritage Oaks Bank. By doing so, Gearhart allegedly stole the investors security interest by using the lots as collateral for the bank loan without the bank’s knowledge of the prior loans.

In a document Gearhart’s attorney Firdaus Dordi filed late last month, the defense argues that Heritage Oaks Bank employee Greg Porter asked Cuesta Title for the faulty title insurance on the parcel.

“Gearhart intends to demonstrate at the evidentiary hearing that Heritage Oaks Bank was aware of the trust deed on the parcel which was recorded in 2007,” the document says.

Gearhart also claims that Hurst Financial principals James Miller and Courtney Brard made the false promises to the investors, and not Gearhart. In addition, Gearhart contends he is also a victim of Miller and Brard’s fraud because they only paid him a fraction of the total funds raised for Vista del Hombre.
On June 1, Judge Wright permitted victims to describe their losses. Statements the judge is required by law to consider when handing down Gearhart’s sentence.

Before the statements, United States Attorney Stephen I. Goorvitch asked the court if people the court may later determine are not victims could speak, the judge said all of the people Gearhart defrauded are victims.

“If someone has lost money or property to Kelly Gearhart, I want to hear from them,” Judge Wright said. “You are victims.”

Investors who lost money or property to Gearhart, and did not speak at the June 1 hearing, can speak at Gearhart’s sentencing hearing scheduled on June 29 at 1:30 p.m. in courtroom 11 at the United States Courthouse at 312 N. Spring Street in Los Angeles.

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  1. amethyst says:

    What was the sentence on Monday?

    (1) 1 Total Votes - 1 up - 0 down
    • smile4thecamera says:

      Yes, I would like to know also!

      (1) 1 Total Votes - 1 up - 0 down
      • 3 putt says:

        It was continued to Thursday–Additional victims wanted to be heard, and the judge wanted to hear from them. I take that as a good sign.

        (6) 6 Total Votes - 6 up - 0 down
        • Jorge Estrada says:

          I take that as the judge wants to hear from them too? I do not read a good sign in this. Then there is the fact that I am not a victim nor will I get any emotional relief in the outcome. In my opinion the Non-Existent Speedy Trial has already laundered this case.

          (-2) 2 Total Votes - 0 up - 2 down
  2. indigo1955 says:

    THAT IS TAMARA’S HUSBAND?????!!!! Omg… is all becoming clear to me now!

    (5) 7 Total Votes - 6 up - 1 down
    • Jorge Estrada says:

      Other than Kelly’s husband, who is Tamara and how does she fit by other associations?

      (1) 5 Total Votes - 3 up - 2 down
  3. amethyst says:

    Why isn’t Melanie Schneider charged with criminal charges for fraud in San Luis Obispo county, being that’s where she committed the crime? That should be separate from the Federal charge that Kelly got her immunity from. I wonder if she’s working for a Escrow company in Colorado Springs….She should be held accountable for her part. Obviously Cuesta Title (Stewart Title) was successfully sued because of her, so don’t know why she should be free of charges there.

    (27) 29 Total Votes - 28 up - 1 down
  4. Jorge Estrada says:

    I’m waiting for the real squeal to begin, Kelly will never find freedom with a belly full of dirty secrets. He has an opportunity to do the right or finish his life in a cage.

    (17) 21 Total Votes - 19 up - 2 down
  5. kayaknut says:

    How about if the judge tells Gearhart “Return every single penny now to all the investors and then maybe we will see about a reduced sentence”……

    (52) 56 Total Votes - 54 up - 2 down
    • mkaney says:

      They were all complicit.. from Heritage Oaks Bank to Gearhart to the Title Company… but he will never come clean and name names. But when Heritage Oaks took government money, they also got government protection and with a few management changes that were handled in a “professional” (B.S.) manner so that no losses were incurred by the guilty, they were allowed to continue and even to get a sweet deal on the purchase of several large banks in the area.

      The banks they sucked up were better run organizations, especially Santa Lucia, but the government targeted small, well capitalized institutions that did not take bailout money. The government increased capitalization requirements to make it difficult for banks if they didn’t take the bailout money. The feds favored the bailed out banks in order to improve the chances of those loans getting paid.

      So to “save” our financial system, Americans bailed out the banks with the biggest problems. They had the biggest problems because they played the biggest games and were the most corrupt. Then, to “save” our monetary system we intentionally drove our smaller better run banks out of business, allowing the corrupt institutions to strengthen themselves by making back room deals to purchase up the assets of the smaller banks.

      Dirty dirty dirty. People are worried about the classic villains played up by law enforcement, or the troubles they perceive to be brought by illegal aliens, and nobody pays any serious attention to the real problems.

      (23) 27 Total Votes - 25 up - 2 down
  6. dogeatdog says:

    Just another person claiming they are innocent as they sit in jail.

    Does anyone take responsibility for what they do any more?

    I hate when the banks and such FORCE you to take extravagant vacations with money that is not yours.I did not even read the whole article, because he just has the criminal mindset and I am sick of it. Another innocent man in prison boo hoo!

    50 years would be fine IF he showed remorse, but he shows none. And 50 years with good time, and everything else he could be out in 15- 20 years, sorry that does not work for me.

    Sit in jail and rot you POS, remember all those fancy vacations you took with other peoples money. Think of all that tasty food you ate as you eat jail slob you fat slob. Remember the love you made to your wife during those times, as some cell mate makes you his be itch.

    Those people worked hard for their money to spend as those choose, not you. I think the bank holds a lot of responsibility also, make no mistake about that and they have ill gained profits also, but we are talking about you.

    You took good peoples money with illegal intent to use it. You are no better than a burglar, phone scam artist or bank robber, you stole to give yourself something you could not other wise get.

    Like so many others who watch reality t.v. you wanted fame and fortune without earning it.You lived the dream, now endure the nightmare, the rest of your life in prison,with scum much worse than you.

    (48) 54 Total Votes - 51 up - 3 down
    • SLO_Johnny says:

      It would be great if he was sitting in jail. The SOB is out on bail until sentencing.

      (41) 45 Total Votes - 43 up - 2 down
  7. fat chance says:

    That’s some funny $hit! Does he think we are all as stupid as Von Dolan lol

    (34) 38 Total Votes - 36 up - 2 down
  8. scoopone says:

    50 years sounds good to me!!!!

    (50) 52 Total Votes - 51 up - 1 down

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