Gearhart sentenced, cuffed, headed to prison

July 2, 2015

Updated at 6 p.m.

Kelly Gearhart

Kelly Gearhart

By KAREN VELIE and DANIEL BLACKBURN

Notorious North County developer Kelly Gearhart was sentenced to 14 years in federal prison Thursday morning by U.S. District Court Judge Otis Wright II in Los Angeles.

Gearhart, 54, was immediately stripped of his eyeglasses, wedding ring and other personal belongings, handcuffed, and led out of the courtroom by two federal marshals.

The sentence was three years more than prosecutors had suggested. While Gearhart had hoped for a more lenient prison term, Judge Wright sentenced Gearhart to 14 years each on two counts of wire fraud and one count of money laundering to be served concurrently.

A court official said Gearhart likely will serve at least 85 percent, and probably all, of the sentence.

Gearhart’s attorney Firdaus Dordi argued that Gearhart had been an honest developer whose pride drove him to bend the rules after the market went south. Dordi said that Gearhart had donated money to build the Atascadero High School track, money Dordi said did not come from investors in Gearhart’s projects.

However, United States Attorney Stephen I. Goorvitch  displayed an accounting that showed the $35,000 Gearhart donated for the track came from investors in his Salinas project. Goorvitch said that while a history of philanthropy can result in a lower sentence, in this case Gearhart was spending the victim’s money.

Gearhart’s attorney asked the court to allow his client to remain free until his Oct. 20 restitution hearing so that Gearhart could have time to explain his situation to his 5-year-old daughter.  Judge Wright denied the request while questioning if Gearhart had squirreled money away that he could use to flee.

Gearhart cried intermittently throughout an approximately five-minute statement that included apologies to his victims and claims others had told him his fraudulent acts were legal.

“I want to say how deeply sorry I am to everyone involved and their families,” Gearhart said. “I relied on someone else to say it was lawful. I did not know when to give up. I let my ego get in the way.”

Judge Wright said that even though the prosecution had not clearly established direct harm to hundreds of victims, the grievous harm Gearhart inflicted on his victims led to the higher sentencing.

“I want to note that many crimes are motivated by needs,  some by drug addictions, and some by plain and simple greed,” Judge Wright said.

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pearl

Oh Give me a break ! We have known Kelky for years. He knew what he was doing was illegal, he always boasted that the regulations are for others , he does what he needs to do!

You got off easy mister! 14 years is not even half of what you deserve!

Lies, deceit , fraud, and ego!


obispan

Yes, regulations are for others. This is how you capitalize on influence and suppress free market competition.


Slowerfaster

This is what Republicans do when they are de-regulated !

Perfect example !


Oh, the SOCIALIST court system caught him ? How precious !


BeenThereDoneThat

No this is what happens when people have no morals or values. Nothing else.


Slowerfaster

So… REPUBLICAN !

Gotcha !


TacomaRose

trying to turn this into a red vs blue debate is juvenile … Crooks come in both colors. Take your blue pie plate back to the campaign office where it belongs


Slowerfaster

Gearhart had an open disdain for ‘regulations’. Thought he was above them and the law. Greed and acquisition of wealth was his driving force.


How does this differ from the all-encompassing themes of the Republican party ?

I doubt they learned them from Kelly. Rather the other way around.


SloNative46

A fraud is caught and convicted and you want to make it political? Sheesh.


kayaknut

For some people that is all they have, facts escape them constantly.


sbjcl

One citizen of the year down another one to go.


Mr. Holly

Wade who?


Cindy

Wade a minute, I think he means the Grigger guy.


Mr. Holly

They should just be the 2 at the top of the list


Ron

Actually, TWO more to go ; -)


See, where Gearhart f-d up, is, he didn’t become “friends” with every single influential politician, media person, AND “justice” system person in SLO County, including (and very, very importantly), every single SLO County District Attorney over the past 25 years, including Dan Dow, of course… before he ran his scams.


Had Gearhart simply become “friends” with all of those people, before he ran his scams — like a certain previous “Citizen of the Year” in Los Osos — he wouldn’t be in prison right now. Instead, he would be a member of the SLO County government “team,” with the full protection of the SLO County Counsel’s office.


Now, THAT’s how you run scams in SLO County. Brilliant!


Uh, Kel? Quick tip: The next time you want to scam a bunch of people out of money, be sure you’re “friends” with the SLO County DA, and a client of the SLO County Counsel’s office, first.


Makes ya Teflon, brah! Trust me, nothing will ever stick.


Giuseppe

Who was Gearhart’s SLO County attorney at the time, who he blamed for approving what Gearhart’s as legal?


Rawhide

If X CMC Corrections Officer Kelly Gearhart serves his time a CMC San Luis Obispo CA…They’ll treat him like a Queen…


Slowerfaster

That’s cheeky.


Perspicacious

CMC is not a federal prison.


Fedup

I’ll bet Miller is sh…ing a brick right now.


Cindy

My question is, does anyone have an idea what’s going on with Jay Miller? I know he rolled over early for a deal to save his daughter Courtney Berard but isn’t he supposed to be getting sentenced? if so, I wonder how he feels after seeing Kelly go away for 14 years? When is his sentencing hearing?


Also what about Cuesta Title and Miss Melanie Schrader, Snieder (what her last name is)? The judge was right, what about the title company? Does anyone have any idea if they are going to be indicted? Isn’t the statue of limitations running out if it hasn’t already?


achillesheal

Maybe in addition to 3 hots, a cot and trying to keep his virginity in tact, Kelly could take to the exercise yard while in prison.


Not only did he “lose” his investors money…he gained a ton.


SLO_Johnny

I’d pay to see a picture of him in his orange jumpsuit. I was worried that the judge would continue bail during an appeal. He obviously rubbed this judge the wrong way. I think his little speech were he tried to pass blame cost him several extra years in lockup.