Criminal trial for former Sunwest CEO Jon Harder delayed until 2015

MarketsAssociated Press

The former chief executive of a Salem-based chain of retirement centers has had his criminal trial pushed back until next year.

Jon Harder, 49, the former president and CEO of Sunwest Management, was indicted in September 2012 on fraud and money-laundering charges. He pleaded not guilty, and his trial was scheduled for October. It has now been moved to May 2015, the Statesman Journal reported ( ).

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His attorney, Robert Hamilton, said the delay was necessary because of the case's complexity. "This is a huge case and one of the largest alleged losses in the history of the federal district of Oregon," Hamilton said.

The U.S. Attorney's office declined to comment.

The Sunwest Management enterprise consisted of over 700 corporations, partnerships and limited liability companies.

The indictment alleges that Harder defrauded more than 1,000 investors out of $130 million by operating a kind of Ponzi scheme.

Sunwest started to lose money as early as 2006. As it collapsed, Harder went on a buying binge to mask its losses, raising money from banks and investors to acquire more than 100 assisted-living centers, according to the indictment.

At its peak, Sunwest Management had about 300 senior housing and assisted living facilities. The company at that time housed more than 15,000 people with an average age of 85.

The indictment said Sunwest Management routinely commingled investor funds in Sunwest-controlled companies, and then misled investors about its business practices and financial strength.

The company went through a re-organization after Harder stepped aside in 2009. A private equity company bought most of the holdings.

In a separate case, the U.S. Securities and Exchange Commission in 2009 filed a lawsuit that accused Harder and Sunwest of committing securities fraud.

The SEC sought up to $190 million in civil penalties from Harder. But in 2012, U.S. District Judge Michael Hogan struck down the SEC's attempt to collect civil penalties.


Information from: Statesman Journal,