Tough call as to whether Tharp played a role in that or got bamboozled himself. Though you're right in that it can't help his rep to be associated with a fraud. Personally I don't feel sorry for investors who lose their money to scamsters. If you are naive enough to be conned, you don't know the business. And if you can't do your own due diligence, you shouldn't be giving money to some guy you don't know from Adam based on a hype reputation and a second hand recommendation.
I believe Dr Van K. Tharp has settled the claim from Mobley's clients out of court. Seems to me that as investors it is they that should have 'done due diligence'. I guess its par for the course that when things go belly up they scream and shout and fail to take responsibility for the decisions they made.
Since I'm his son I should reply especially to straighten out the facts. The Maricopa fund that Dave Mobley ran was a ponzi scheme. He found investors claimed huge returns that were false and paid original investors with money from newer clients. I personally had over $200,000 with Maricopa with one of my companies. If you ever see a list of all the investors you will see a company called Bodhi. I am the CEO and largest shareholder by far in that company. Luckily I needed capital and withdrew majority of it within just a few months of having it there. I was an investor in that fund but was lucky to get out. Now my father wasn't so lucky. He had over 70% of his networth with Maricopa, including his retirement allocation, his company employees had ALL of their funds invested with David. Had he known this was fraudulent would he have lost millions personally? This is actually a very hard subject for my father. He lost millions, was betrayed by someone he thought was his best friend, had lots of clients who he was great friends get taken also. This came as a complete surprise to him as he used to spend hours with David working with him on different psychological issues. Unforunately this never came up during any session. every once and awhile I see some post where they quote my father from Market Wizards saying how he doesn't trade. Guess what up until Maricopa he felt he didn't have to. He would invest with his students. Quite a few of his supertraders ran funds that did exceptionally well. This way he could teach and use leverage to his advantage. After Maricopa he no longer funds traders anymore. He decided he needed to start trading on his own. He now position trades. please direct all questions about this to me first before starting rumors thanks Robert Tharp
Sounds like a painful honest mistake to me. Though I find it tragically ironic that a guy who literally wrote the book on position sizing would put 70% of his eggs in one basket, especially when it's logical to assume he had a number of other quality traders to diversify his portfolio with....
Robert, thanks for clearing that up. I have to admit that when I first picked up your father's book, I had read the Barron's cover story on Maricopa recently, and when I saw the intro written by Mobley I had a massive reaction to just close the book. I'm happy that I gave it a chance and read further. Such a bitter experience goes to reinforce the principle that one should NEVER put his wealth in one single place. No matter how bright the prospects may appear.
Robert: I'm curious as to how Mobley conned your dad through and through, given that Tharp senior is trained in psychology and presumably has a lot of experience seeing through people's BS. Not only did he get your dad's trust, he apparently got his complete and total I will never doubt you here is all my money trust. Was Mobley the slickest operator since Clinton or what? I guess my question is your father seems too savvy to be so completely snowed like that, especially given his background, traing and relevant experience. Not the first candidate you think of in terms of falling for a ponzi scheme. In fact, maybe the last candidate. Not throwing out accusations just trying to put the puzzle pieces together so 2 + 2 = 4.
he's human. Greed became involved. 80% returns (after the so called fee's) with almost no losing months for 3 or 4 years?? Robert
He is completely dumbfounded. Dave Mobley spent over $80,000 worth of money on consulting fee's, A lot of these consulting sessions involved getting into a human's deepest and darkest hidden emotions. Usually everything comes up. Somehow Dave was able to never bring up these feelings. My father also worked with the rest of the Mobley's family. Dave never had an audited account saying he didn't want anyone to figure out what he was doing as it would heavily diminish his returns if they were to copy him. If it's too good to be true it probably is, but unforunately this is hindsight. Nobody wanted to think about it. In fact when the Barron's article came out we were all shocked. Dave Mobley denied everything. My reaction was well if it was true why did David Mobley sent a letter about 3 or 4 months earlier saying he would close his fund to new investors. If this were true he would constantly accept money. Well.........hindsight again. When a fund says no more money is going to be allowed. That's when some of the largest deposits are made by investors. This was due to David knowing he was going to have to soon run. Luckily SEC /Barrons figured it out before everything was gone. Robert Tharp
I have read with interest many of the recent stories about the hedge funds which have imploded. Another major fund which defrauded investors occurred under the management of a man named Reed Slatkin and he happened to defraud many people for the benefit of a select few...This Mobley fraud was just as despicable... The real issue I have is with the absolute lack of transparency. It is just amazing to me to discover that these guys can run these ponzi schemes for years at a time and investors have no way of discovering what is really going on behind the scenes...
At any rate, I think most of these frauds have had their run. It will be much harder down the road to say "no you can't look at my results I'm keeping things secret" because that will cause immediate alarm bells to go off. Hopefully from here on out people will learn to only give $$$ to those whom they can trust implicitly, who have understandable methods and who are not afraid to open their books at any time. In hindsight the hedge fund fiasco is not much different than the wacked out accounting phenomenon causing all these energy firms and conglomerates to be taken out and shot for dishonesty