A northern Indiana businessman’s bankruptcy proceedings are clouded by accusations that he conned multiple people out of their retirement savings. Chris Coffey reports.
A northern Indiana businessman’s bankruptcy proceedings are clouded by accusations that he conned multiple people out of their retirement savings.
Richard E. Gearhart and his company, Asset Preservation Specialists, Inc., handled money for dozens of clients, according to court documents. Gearhart, 63, is accused in court papers of running a Ponzi scheme and swindling victims out of their savings, totaling more than $2.9 million.
Complaints filed by at least ten investors allege Gearhart tricked clients into signing worthless promissory notes and spent their investments making loans.
Delores Hickman of Valparaiso, Indiana, purchased life insurance from Gearhart for a number of years and agreed to invest her savings with Gearhart in late 2011. Hickman said she was guaranteed a protected investment that would yield 6 percent interest payments.
“I trusted him because I’ve had a long-term business relationship with him,” Hickman said.
Hickman said she was counting on her investment to help pay for future medical bills. She is living with multiple sclerosis.
Hickman told NBC 5 Investigates she only wanted her investment to sit in the account for one year before removing it.
But when she asked for her money to be returned?
“His response was, ‘it’s gone,’” Hickman recalled.
Rebecca Hendrix also purchased insurance from Gearhart and agreed to invest her funds with Asset Preservation Specialists, Inc. in 2009. Hendrix, too, lives with multiple sclerosis.
But Hendrix claimed she learned her investment was gone in December, 2012.
“My health has really gone down since this because of the stress,” Hendrix said.
Gearhart and his attorney declined to comment. However, in court papers he denied spending Hendrix’s money on his own behalf. He contends that the funds were a loan, and that while money may be owed, he is not guilty of any fraud or other wrongdoing.
A chapter 7 bankruptcy trustee for Asset Preservation Specialists, Inc. is attempting to locate the funds and see if customers can get their money back.
“I am frustrated with the process and very little hope that any of us will recover our retirement funds,” Hickman said.
Federal investigators will not confirm or deny they are investigating Gearhart. But some creditors have received letters from the FBI and US Postal Inspection Service identifying them as possible crime victims.