Kelly Gearhart lashed out against CalCoastNews reporters in 2008 on Dave Congalton’s KVEC radio talk show, saying reporters were wrong about the value of properties and legal requirements. During the same show, one of Gearhart’s bankers claimed that reporters had incorrectly determined percents of beneficial interest on a project, a percentage prosecutors later used to indict Gearhart.
On Thursday at 5 p.m., Congalton will replay part of his May 2008 interview with Gearhart. Turn your radio dial to 920 A.M. or listen live at 920KVEC.com.
On April 28, 2008, Daniel Blackburn and Karen Velie coauthored an article about the financial perils of Gearhart’s $28 million Vista del Hombre project in Paso Robles.
“It’s only a few second’s drive time between the weathered plywood sign on Paso Robles’ Jardine Road announcing the imminent approach of “Vista del Hombre,” and its equally unimpressive, unmarked entrance, but that brief moment is sufficient to show passersby that they have encountered one truly unremarkable piece of real estate.
“What is remarkable, though, is that hundreds of local investors have put big money and faith into Hurst Financial of Atascadero, and in turn into Vista del Hombre — approximately $28 million already for this project alone — yet have seen only minimal progress on the Kelly Gearhart golf course-business park development over the past several years.
“Hurst has doled out to numerous investors approximately 8,000 percent beneficial interest in the planned 32-building development, according to the title report. It appears that investors hold more than 200 percent interest in each structure.” Click here to read the entire article.
Shortly after Congalton interviewed Gearhart on the air, reporters Velie and Blackburn published an article detailing issues with appraisals and a loan regarding the Vista del Hombre project.
“A million-dollar loan from Heritage Oaks Bank to North County developer Kelly Gearhart earlier this year was based on “erroneous” and questionable claims, according to the bank’s own appraisal.
“That appraisal was not received by bank officials until nearly two months after the loan proceeds had been paid to Gearhart.
“Gearhart secured the loan Jan. 16 for his Paso Robles Vista del Hombre golf course and mixed 32-lot development project east of downtown Paso Robles. The title report to the Vista del Hombre project lists the bank as a creditor. But the property’s current $27 million encumbrance is not listed on the bank’s appraisal report.” Click here to read the entire article.
By early 2009, a local banker filed a foreclosure against Gearhart regarding a loan on the Vista del Homber project.
“Heritage Oaks Bank has filed foreclosure notices against developer Kelly Gearhart’s Vista Del Hombre project, as well as Karen Guth and Joshua Yaguda’s Pasolivio Olive Ranch.” Click here to read entire article.
In 2012, a federal grand jury indicted Gearhart.
“Onetime Atascadero ‘Person of the Year’ and prominent North County land developer Kelly Gearhart has been indicted by a federal grand jury and faces 16 charges of mail fraud, wire fraud, and money laundering. Investigators are calling it a ‘multi-million-dollar case.’ ” Click here to read entire article.
In 2014, Gearhart was sentenced to 14 years in federal prison, a sentence that was later reduced to nine years. Because of the pandemic, Gearhart is facing an early release from prison.
“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.” Click here to read entire article.