HAMMOND, Ind. (Inside INdiana Business) — A Carmel man has been sentenced to seven years in prison after being convicted of wire fraud and conspiracy to commit securities fraud. U.S. Attorney Clifford Johnson’s office says George McKown and a partner defrauded investors of more than $5 million.
Court documents show McKown and his partner Richard Gearhart operated Asset Preservation Specialists between 2008 and 2013. The partners recruited more than 40 people to invest their savings, pensions, death benefits and IRAs and promised a return of 6% to 8% on their investments.
McKown and Gearhart then took their clients money to fund their personal business projects, as well as projects of their associates. The partners would provide clients with fraudulent statements and 1099s saying they were making a consistent profit on their investments.
Johnson’s office says many of the victims learned they had lost their savings when Gearhart filed for bankruptcy in 2013.
In addition to the prison sentence, McKown was ordered to pay more than $5.2 million in restitution to the victims.
Gearhart pled guilty to a charge of conspiracy to commit securities fraud in December 2019. He was sentenced to five years in prison and ordered to pay more than $5 million in restitution.