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David Mobley himself has become a fixture at trading seminars put on
by North Carolina psychologist Van K. Tharp, who has made a career of
counseling both professional and amateur traders in behavioral
self-control. Money really started cascading into Maricopa (Mobley's
fund) after June 1997, when Tharp touted Mobley's performance record
and called him the most successful graduate of Tharp's two-year Super
Trader Program. Mobley's investment record was even touted by Tharp in
a Forbes magazine profile of the psychologist.

Tharp recently told Barron's in a telephone interview that he thinks
so highly of Mobley that he has put the bulk of his personal wealth
into Maricopa. Tharp's Website, called the International Institute of
Trading Mastery, describes Mobley as a "fantastic trader and
businessman" and a "wonderful human being."
------------------------
Barrons also reported that Maricopa has reported no losing years and
only five down months in its 88-month history (through December, the
most recent month for which a report is available). The best reported
annual return was 62.52% in 1995; the worst, 34.54% in 1994.

The Feb 28th issue of Barron's describes how it was all a Ponzi scheme
and that FBI had raided the offices and shut the fund down. It is
very surprising that Tharp could not figure out if Mobley was for
real or a fake. Mobley also wrote the foreword to Tharp's recent
book, "Trade your way to financial freedom". If "bulk of his personal
wealth" was indeed in the fund then we should see some cheap seminars
soon.

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From Barron's describing the end of Mobley's hedge fund. Particularly
sad for all the retired people who lost their money.

February 28, 2000

Follow-Up:
Deposing the King
Hedge-fund chief said to admit massive fraud

The end came early last week with brutal finality and dispatch for
Naples, Florida-based hedge-fund manager David M. Mobley, just 10 days
after a skeptical Barron's cover story entitled "King of Naples" had
hit the street.

On Tuesday, February 22, the Securities and Exchange Commission filed
an emergency enforcement action against Mobley and his Maricopa funds
complex in Federal District Court in Manhattan. Simultaneously, agents
of the FBI and IRS raided Mobley's offices. The agents worked late
into the evening, securing the premises and carting off records after
Mobley earlier that day had agreed to a freeze of Maricopa's assets
and agreed to cooperate with the SEC in a continuing investigation.

FBI agents remove Maricopa files.
The Naples Daily News described the sad tableau of several retirees,
who had much of their net worth invested in Maricopa, sitting stunned
in their luxury cars in the firm's parking lot, as federal agents
bustled to and fro.

A receiver is expected to be appointed soon to try to find and
preserve any remaining assets of the various Maricopa funds so that
investors may receive at least partial restitution. Likewise, Barron's
has learned, a criminal referral has been made to the U.S. attorney's
office in nearby Fort Myers.

So Mobley, in addition to facing likely penalties including
disgorgement of illegal profits on the civil fraud charges he is
accused of and, investigators say, has admitted to, could also face a
raft of federal criminal fraud charges. Especially in light of the
damaging admissions that, the probers maintain, he made in sworn
testimony at the SEC's Washington office last week.

Mobley confirmed to investigators what Barron's had expected, namely
that he was running a Ponzi scheme, in which he phonied up fancy
investment returns of better than 50% a year supposedly earned by
trading sophisticated stock-index instruments. He told investigators
that he'd taken in some $140 million over the past seven years,
according to knowledgeable persons. The $450 million in assets under
management that he'd previously claimed apparently was just a figment
of his febrile imagination.

In actuality, the SEC found only about $33 million in Maricopa's
coffers, mostly in a Morgan Stanley Dean Witter account that Mobley
used as a piggy bank.

As to what happened to the rest of the $140 million, Mobley told
investigators that some $60 million of it had been dissipated in
failed personal investments in a cigar bar, real-estate projects, a
shuttered sports bar restaurant, a defunct market-research firm and a
failed mortgage company. And a large amount had simply paid for his
free-spending lifestyle, which provided him with $3 million in
personal remuneration last year, a $98,000 Porsche and more than $4
million spent on fancy homes for himself, his estranged second wife
and his sister and daughter. He also gave some $3.5 million to
charities.

Mobley said in his confession that some $48 million had been eaten up
in account redemptions to maintain the illusion of Maricopa's
financial soundness.

SEC officials said the Barron's story had prompted their
investigation, although the Commodity Futures Trading Commission,
which filed similar charges against Mobley and Maricopa last week, had
been investigating Mobley for possible registration violations. A
three-person team under William Baker, associate director of the SEC's
Division of Enforcement, was formed and sprang into action on February
14, two days after our story was available on newsstands. By late that
week, Mobley began to crack under the investigators' aggressive
questioning. Adding to the pressure were a slew of redemption
requests, which would have more than wiped out his funds if they had
been honored some 30 days later, as stipulated in the funds'
agreements.

Mobley flew to Washington a week ago Sunday, making a sometimes
tearful confession over two days of aggressive grilling.

All of his ill-gotten gains will likely be liquidated soon to provide
recompense to injured clients. And some investors who are
congratulating themselves on having gotten out early will be in for a
nasty surprise. They probably will have to return any gains, even if
they have already paid taxes on them, to facilitate an even-handed
settlement for all Mobley clients.

One can't accuse the hedge-fund operator of lacking a devilish sense
of humor, however. Last December, his funds reported a bogus
investment gain of 6.66%.