Front Page  »  

Coronavirus springs Kelly Gearhart from federal prison

April 16, 2020

Kelly Gearhart at his sentencing in 2015

By KAREN VELIE

Former San Luis Obispo County developer Kelly Gearhart is scheduled for an April 29 transfer from federal prison into confinement at his Wadsworth, Ohio home as part of a plan to limit the spread of the coronavirus behind bars.

Gearhart is currently serving a nine-year sentence related to a hard money lending scheme in which he bilked investors who put money into his Central Coast real estate projects out of millions of dollars. Gearhart, who is not eligible for parole, is scheduled for release on March 2, 2023.

Prison staffers are not releasing information regarding coronavirus cases at the Morgantown Federal Corrections Institution, a small minimum security prison located in West Virginia where Gearhart is currently incarcerated. Nationally, 318 federal inmates and 163 staffers have tested positive for the cornavirus, and nine prisoners have died, according to information released on April 10.

To combat the spread of the virus, the federal prison system is permitting inmates who do not have a history of violence, have served 50 percent of their sentences and who have underlying health conditions to be transferred into home confinement. It is currently unclear whether inmates will be required to return to prison following the pandemic, or if they will be permitted to serve out their sentences at home.

Kelly Gearhart and James Miller

Starting in 2008, CalCoastNews exclusively reported that Gearhart and hard-money lender James Miller had swindled investors in a lending scheme with the assistance of title officers, lawyers, public officials and an appraiser.

More than 1,200 investors, primarily seniors, placed nearly $100 million with Miller for funding construction loans. Instead of protecting investors by funding projects only as work was completed, Miller paid Gearhart in lump sums without any monitoring of the construction, a violation of the investor contracts.

In July 2012, a federal grand jury indicted Gearhart on 16 charges of mail fraud, wire fraud, and money laundering. If convicted on all charges, Gearhart faced as much as 300 years in federal prison.

In 2014, Miller pleaded guilty to charges of mail fraud, wire fraud, money laundering, and making a false statement to a bank under an agreement that his daughter Courtney Brard would not be prosecuted. In 2015, Miller was sentenced to seven years in federal prison.

Gearhart pleaded guilty in 2014 to two counts of wire fraud and one count of money laundering under an agreement that his wife Tamara Gearhart would not be prosecuted. A year later, U.S. District Court Judge Otis Wright II sentenced the disgraced developer to 14 years in prison, a sentence which was later reduced to nine years.

Sign up for breaking news, alerts and updates with the Cal Coast News Top Stories Newsletter.

 


Loading...
Related:


15 Comments
Inline Feedbacks
View all comments

Well, it looks at least as if he cared about his family, although that, too, may be self-interest.


3

This might keep Adam Hill out of jail.


-6

Time to visit Ohio to collect.


16

So the wuhan flu cures graft? Who would have thought.


21

Gearhart a true shyster and sorry to hear he gets to sleep in a real bed and use a real bathroom. But, just as in the case of Bernie Madoff, it takes two to tango. People who entered into investments with him which promised exorbitant returns were almost as plagued by greed as he was.


-12

The people who were defrauded were “plagued by greed” and are no different than Gearhart? Maybe you and Gearhart can team up and go into business when he comes back and use that as a basis to justify more fraud and empty more seniors’ retirement funds. They’re just asking for it, right?


19

The COVID-69, it not who you know, its who gets out of jail.


13

He had a number of RESTORED collector cars that vanished overnight. I’ll bet they show up again at his house.


35

Some of the his many ill-gotten and un-traced assets. Gearhart has been doing business from behind bars with a local realtor regarding his properties that were hidden from the federal court. A notary is sent to the jail for the transactions. Geargart has had his same local co-conspirators while he was in the pen.


31

Or his wife’s house…or his daughter’s house.


1

This is so very wrong in many many ways ….. Gearhart is just laughing at the penal system and his victims .I hope KARMA comes into play .Kelly Gearhart more than likely learned these money schemes from his inmates at CMC where he worked as a correctional officer …He saw that the minimum security white collar inmates had a pretty easy stay at the gray bar hotel …Probably figured Fed time would be even easier …I feel for all the victims of his and his cohorts schemes .At least Chuck Odell got his bite out of Gearhart but he was one of the few


35

Total BS…I’m sure he has a ton of money stashed away.


40

BS = Barbra Streisand


-2

My understanding is that yes he does. A whole new investigation is needed.


34
1 2