Author: Karen Velie

Hertel and Fowler caught up in yet another scandal

Posted by Karen Velie | Mar 5, 2009 | Uncovered SLO | 0 |

By THE EDITORS

Securities and Exchange Commission investigators are probing California Assemblywoman Diane Harkey (R-Orange County), her husband Dan, and his hard-money lending company, Point Center Financial, regarding the Harkey’s relationship with R.W. Hertel and Sons.

The investigation is said to focus on Dan Harkey’s dealings with R.W Hertel and Sons, a company owned by Ronald Hertel and Robert Fowler, and the Burnett Development Company. Both companies donated to Diane Harkey’s campaign before receiving loans from Point Center. Each defaulted on their loans, which were subsequently found to have been massively overvalued. Thousands of investors have been left holding the bag and some are accusing Harkey of perpetrating a Ponzi scheme.

Living large on Atascadero taxpayers’ dime

Posted by Karen Velie | Mar 2, 2009 | Uncovered SLO | 0 |

By KAREN VELIE

After proclaiming a looming fiscal crisis and predicting municipal worker layoffs, Atascadero City Manager Wade McKinney and city taxpayers treated a group of upper level employees to a three-day excursion at an upscale Carmel Valley resort.

But before heading north, McKinney offered city employees a voluntary resignation program: they could receive 30 percent of their pay for vacating their positions; take partial retirement or voluntary furloughs; or accept a reduction in work hours.

Weyrich belly up, money woes widening

Posted by Karen Velie | Feb 26, 2009 | Uncovered SLO | 0 |

By KAREN VELIE

In yet another sign of mounting unpaid debts for Paso Robles businessman David Weyrich and his wife, Mary Weyrich, a local lender filed a lawsuit Tuesday alleging that the Weyrichs failed to pay back a more than $1 million loan.

“Unfortunately, The Weyrichs owe me and my partner, Jim Smith, over $1.6 million in different promissory notes,” said San Luis Obispo businessman Cliff Branch. “To date, the Weyrichs have not paid us back a penny. David and Mary gave us their personal guarantee, but apparently that does not count for much.”

UPDATE: Dancing Star whistleblower shown the gate

Posted by Karen Velie | Feb 25, 2009 | Uncovered SLO | 0 |

By KAREN VELIE

Dancing Star Foundation has fired a fulltime employee considered a whistleblower by supporters because of his actions in bringing to light the killing of healthy animals at the Cayucos animal sanctuary.

Earlier today, sanctuary foreman Jerry Smith ordered maintenance supervisor Jason Hamaker to vacate the ranch home he occupies within 24 hours, and fired the outspoken employee.

Money problems driving sanctuary kills

Posted by Karen Velie | Feb 24, 2009 | Uncovered SLO | 0 |

By KAREN VELIE

Many healthy animals entrusted to Dancing Star Foundation’s Cayucos sanctuary have been euthanized in recent months after being placed on a “kill list” — prepared with the help of a veterinarian and weighted heavily by economic considerations.

A top sanctuary employee who witnessed the process is speaking on the record and has provided documents to CalCoastNews including death certificates, medical records, and the actual list of animals slated for the needle. The facility is endowed with $43 million in assets to care for aged and infirm farm animals.

UPDATE: They shoot horses, don’t they? Maybe not

Posted by Karen Velie | Feb 20, 2009 | Uncovered SLO | 0 |

By KAREN VELIE and DANIEL BLACKBURN

A temporary halt in the random killing of animals at Cayucos’ Dancing Star Sanctuary has been declared by officials of the Los Angeles-based foundation that administers the facility.

Sanctuary becomes killing field for “protected” animals

Posted by Karen Velie | Feb 17, 2009 | Uncovered SLO | 0 |

By KAREN VELIE

A husband and wife team of internationally known environmentalists, paid handsomely to oversee a San Luis Obispo County sanctuary for infirm animals, has ordered the accelerating slaughter of many of their wards.

Former and present employees of the Dancing Star Foundation claim that its top officers, Michael Tobias and Jane Gray Morrison, intend to focus on endangered animals. They say the pair has commenced the systematic elimination of aged and infirm farm animals under the foundation’s care, contrary to the foundation’s purpose.

Tobias and Morrison have reportedly told employees that economic issues prompted the kill policy.

Gearhart files bankruptcy

Posted by Karen Velie | Feb 12, 2009 | Uncovered SLO | 0 |

By KAREN VELIE

Kelly Gearhart, a North County developer with ties to hard money lender Hurst Financial, has filed for Chapter 7 bankruptcy protection in Ohio.

Gearhart and his wife, Tamara Lowe, filed the bankruptcy petition on Wednesday, stating $6.5 million in estimated assets and $45.1 million in estimated debts.

Deputies seeking sheriffs’ union split

Posted by Karen Velie | Feb 10, 2009 | Uncovered SLO | 0 |

By KAREN VELIE

Members of the county’s largest and most influential union have mounted an aggressive campaign to divide the Deputies Sheriff’s Association (DSA) into two separate unions.

If the action is successful, one union would be comprised of sworn peace officers, the other of non-sworn sheriff personnel.

A break would damage the effectiveness of the association, said DSA President Dale Strobridge. “The most effective way to represent the community is to have a blended agency. We are the most politically effective county organization.”

Developer blames downturn in the market

Posted by Karen Velie | Feb 7, 2009 | Uncovered SLO | 0 |

Robert Fowler forgot to pay some taxes on his 100 acre property near the Santa Margarita Ranch development. In 2005, at the top of the market, Fowler failed to pay $619,000 in taxes and penalties. While Tom Daschle threw his accountant under the bus, Fowler blamed a downturn in the market. Read more at Pacific Coast Business Times

EFI victims question attorney’s actions

Posted by Karen Velie | Feb 4, 2009 | Uncovered SLO | 0 |

By KAREN VELIE and DANIEL BLACKBURN

An attorney with a prominent San Luis Obispo law firm who injected himself into the ongoing hard money lending scandal has assembled a group of investor clients with apparently competing interests.

Roger Frederickson of the Sinsheimer Juhnke Lebens & McIvor (SJL&M) firm was retained in March 2008 by nine investors who lost money in the collapse of Estate Financial Inc. (EFI). Frederickson was to probe aspects of the lenders’ allegedly fraudulent activities and practices.

At least two of the clients asked Frederickson to examine Heritage Oaks Bank as a possible third party and determine if bank officials had a too-cozy relationship with EFI, or failed to sufficiently scrutinize the hard money lender for any appearance of fraud.

Guth, Yaguda still stewing; more arrests hinted

Posted by Karen Velie | Jan 30, 2009 | Uncovered SLO | 0 |

By KAREN VELIE

Prosecutors and defense attorneys today asked a judge to postpone arraignment and bail hearing for Estate Financial Inc. principles Karen Guth and Joshua Yaguda for the fourth time. San Luis Obispo Superior Court Judge Charles Crawford agreed to continue the arraignment of Estate Financial Inc.principles on 26 felony charges to February 20.

Then Deputy District Attorney Steve von Dohlen alluded to the possibility of additional charges being made against the EFI pair, as well as the prospect of additional parties being arrested.

Attorneys on both sides requested more time to put their cases together and to find out which allegations they agree on and which charges they plan to “fight over.”

EFI investor prospects dismal

Posted by Karen Velie | Jan 28, 2009 | Uncovered SLO | 0 |

By KAREN VELIE and DANIEL BLACKBURN

Investors in both the Estate Financial Mortgage Fund (EFMF) and Estate Financial Inc (EFI) received gloomy reports from trustees regarding recouping investments through the bankruptcy court. The bad news was contained in a letter sent to investors earlier this month.

EFMF investors appear to be in the least likely position to recoup investments, despite assurances from EFI boss Karen Guth to investors that their money was more secure in the mortgage fund. Guth was successful at getting her supporters to cash out of investments secured by first trust deeds in exchange for membership in her unsecured mortgage fund.

The day this news site’s world stood still

Posted by Karen Velie | Jan 21, 2009 | Uncovered SLO | 0 |

By THE EDITORS

On a warm afternoon last August, this news site nearly died. It is only because of a considerable confluence of coincidental events, and perhaps some kind of divine intervention, that we are here today to report the events that almost assigned us to history.

UncoveredSLO.com, this site’s predecessor, was just six months old, but already our reporting was irritating some of the county’s most sacred cows. Our work was exposing for the first time the interlaced and problematic relationships between money lenders, developers, and others who then enjoyed favorable reputations, and who were operating without scrutiny. We were hearing threats from bankers. We were receiving vitriolic and anonymous e-mails and postings on the site. And we were getting menacing missives from lawyers. In a word, UncoveredSLO was then, as now, controversial.

Heritage Oaks Bank files big foreclosures

Posted by Karen Velie | Jan 17, 2009 | Uncovered SLO | 0 |

By KAREN VELIE and DANIEL BLACKBURN

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.

Bank officials did so despite a state move on all Guth-Yaguda assets. Following the Oct. 16 arrest of the mother-son team, state officials filed a lis pendens on all properties owned by either suspect. (That’s a formal notice of pending action on a real property claim.)

The petition “seeks to preserve from transfer conveyance or encumbrance real property or any interest in real property which the people of the state of California believes belongs to or is in control of either defendant (Guth or Yaguda)…,” according to court records.