Richard E. Gearhart, 66, of Lowell, Indiana, and George R. McKown, 65, of Indianapolis, Indiana, have been indicted on federal charges of conspiracy to commit securities fraud, securities fraud, and wire fraud in a scam that allegedly siphoned millions from retirees’ life savings. According to the U.S. Attorney’s Office, the duo operated through a company called Asset Preservation Specialists, Inc., selling unregistered securities while falsely guaranteeing returns and safety of principal.
The indictment alleges Gearhart and McKown targeted individuals looking to roll over traditional IRAs, pensions, annuities, and 401(k) accounts into alternative investments—promising steady, guaranteed returns. Victims transferred their funds directly into the defendants’ control, believing their money was protected. In reality, neither Gearhart nor McKown was registered with the Securities and Exchange Commission or the State of Indiana to legally sell securities.
“Gearhart had all the warning signs of a typical Ponzi scheme; he took advantage of people he knew and wasn’t registered with my office to sell securities,” said Secretary of State Connie Lawson. Lawson emphasized that personal trust is no substitute for due diligence, urging investors to verify registration status before handing over any funds. “No matter how well you think you know someone or how successful they look, always check with the Secretary of State,” she warned.
Documents filed in the case suggest the scheme operated under the guise of legitimacy, using professional marketing materials and personalized pitches to lure in victims. Investigators believe the defendants used new investor money to pay fake returns to earlier clients—a hallmark of Ponzi operations. The U.S. Attorney’s Office stressed that an indictment is not a conviction, and both defendants are presumed innocent until proven guilty in court.
If convicted, the judge will determine sentencing after reviewing federal guidelines and statutory factors. The charges carry severe penalties, including potential prison time and substantial fines. The case was the product of a coordinated investigation by the United States Postal Inspection Service, the Federal Bureau of Investigation, and the Indiana Secretary of State Securities Division.
Assistant United States Attorney Toi Denise Houston is prosecuting the case. As the legal process unfolds, authorities warn Hoosier investors to remain vigilant against high-return promises and unregistered financial operators. With retirement security on the line, the stakes in this fraud case stretch far beyond the courtroom.
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Key Facts
- State: Indiana
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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