Convicted swindler Mobley seeks reduced sentence

Naples hedge fund swindler David Mobley, who confessed in 2000 to bilking investors of close to $60 million, is back in federal court in Fort Myers asking for a reduction of his 14-year sentence.

Mobley, 49, has already received a break on his original sentence of 17½ years. In 2004, U.S. District Judge John Steele shaved 3½ years off Mobley's sentence for his cooperation in the state's Stadium Naples public corruption probe, which saw the arrests of three former county commissioners, the former county manager and six others, including Mobley.

Mobley argues that he had poor legal representation by the federal public defender's office on the hedge fund case and that he wasn't allowed to see investors' "victim impact statements" and confront his accusers with that information prior to his October 2001 sentencing. The government inflated victim losses for purposes of the sentencing guidelines and the court discounted Mobley's assistance to state prosecutors in the corruption case, Mobley's attorney, Charles Murray, states in court papers filed last week.

Mobley also states that a woman who didn't invest in his hedge fund was among those who spoke at his sentencing hearing. He takes aim at the federal sentencing guidelines, which in January the U.S. Supreme Court made advisory instead of mandatory.

"The instant case contains complex securities issues peculiar to the hedge fund industry and specialized legal counsel should have been acquired for (Mobley) to explain these issues to the judge," Mobley's petition states.

His attorney, the public defender, didn't tell Steele that all investors signed agreements that said in effect they could afford to lose all of their investment, the petition states.

Chief Assistant U.S. Attorney Doug Molloy said Tuesday he hadn't yet seen Mobley's request, but that "he's way past the time to file it."

"I don't know if the judge will read it," Molloy said.

Mobley's attorney, Murray, was out of the office and couldn't be reached Tuesday.

Prosecutors have until Dec. 19 to respond to Mobley's petition.

Michael Seigel, a law professor at the University of Florida Levin College of Law, said Mobley isn't likely to be successful, particularly since he pleaded guilty and has already had part of his sentence reduced.

"The rate of success is very, very small — probably less than 1 percent," Seigel said of petitions such as Mobley's.

As of November, the court-appointed receiver who seized Mobley's assets and businesses had collected and paid back $36.3 million to 272 investors. The receiver still had close to $3 million on hand and said then that another distribution to investors was planned. Court documents filed in Manhattan, which couldn't be obtained Tuesday, indicate that the receiver plans to distribute more money to investors.

All told, more than $120 million in investors' money flowed through Mobley's Naples-based Maricopa Investments. A former Jeep factory worker with no college education, Mobley passed himself off as a sophisticated hedge fund manager, but all the while funneled unwitting investors' money into his own lavish lifestyle, charities, and a series of failed business ventures, among them the failed Stadium Naples golf arena that touched off public corruption charges involving county officials in Collier.

Mobley duped investors into thinking their money was growing in a successful hedge fund program by making up fictitious account statements. Hedge funds are largely unregulated and typically restricted to wealthy investors who pool their money to trade and hedge investments on the ups and downs of the markets.

At one point, Mobley claimed to have $450 million under management in his hedge funds, which he said he traded based on a proprietary computer model called "Predator."

Instead, he used investors' money to line his own pockets and buy homes in the upscale Quail West neighborhood and a $1.7 million home in Vail, Colo., a Jaguar, Porsche, Mercedes-Benz, BMW, home furnishings, a $40,000 diamond ring and a house in Naples' Autumn Woods neighborhood for his daughter. He gave himself a $2 million bonus just before his scheme collapsed in February 2000 and gave $1.9 million to the First Assembly of God homeless shelter.

In July 2001, Mobley pleaded guilty to eight counts of fraud, money laundering and tax evasion.

The special prosecutor in charge of the Stadium Naples probe considered Mobley a key witness in the cases, which culminated in nine of the 10 defendants pleading to reduced or related charges and all charges being dropped against one.

Mobley, Stadium Naples' primary financial backer and a partner in The Strand real estate development, gave a $100,000 loan to former Commissioner Tim Constantine that wasn't paid back. Constantine was sentenced to a year in jail following his September 2001 no-contest plea to racketeering and influence peddling charges.

The Stadium Naples saga ended in January 2004 when former Commissioner John Norris pleaded to racketeering conspiracy and unlawful compensation charges. He was sentenced to one year of house arrest and five years' probation.

© 2005 All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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