My Mentor is in Prison
03. May, 2010 
7 Comments
I’ve always had a voracious appetite for learning. Back in the early ‘90’s I started researching stock trading and real estate investing. I read everything I could get my hands on and eventually settled on one mentor who taught BOTH real estate investing and stock investing.
At first, stock investing was easier and much more lucrative. I was an executive at Hertz when Ford split us off and took us public. I got a piece of the IPO at the strike price and invested heavily in LEAP’s and companies that announced stock splits. Everything was going great until I filed my taxes that year and realized the full force of short term capital gains. Yikes.
So… real estate investing.
Again, I turned to my mentor for training and advice. I bought books, tape sets (remember cassettes?), videos (remember VHS?) and attended a few live events. I learned a lot about creative investing strategies and asset protection. And now I don’t fear the tax man so much because real estate gives me better protection and deductions than stock investing.
So, fast forward to 2010 and I find myself a bit of a real estate mentor. And as I peruse the real estate forums and blogs online I keep hearing the “scam” word being thrown around. I’ve written about this a few times before because “scam” is a pretty harsh word that I think is misused. And I hate to see it applied to something I do and respect – training, coaching and mentoring.
I was reading a blog where some poor real estate investing trainer was being throttled for not disclosing exactly where he invests. People were saying he must be shady or have something to hide. In fact, one guy went so far as to say that he had bought some of the guys courses and the strategies worked and he was making money but he now thinks he is a fraud because he is “secretive.”
I laughed to myself and thought, “Wow. People would freak if I ever revealed who MY mentor is.”
Because my mentor is in prison.
Behind bars. Locked up. In the slammer for 88 months for tax evasion as a result of an FTC investigation into his marketing practices.
But here’s the real question…
Does that make his investing strategies any less effective?
He never taught me to evade taxes so that’s not an issue. Am I now a failure? Do I not make money? Does this stuff not work after all? Here’s the book that changed my life:
And, yes, Wade Cook is my mentor. Convicted felon. Federal prisoner. Register #36240-086 at the Lompoc Federal Correctional Complex in California.
Now, I’m not defending his tax evasion or any of the underlying reasons why the FTC was targeting him to begin with. If he lied and cheated on his taxes, that’s not cool. But I am defending the fact that his training helped me succeed.
Was it all him? No. I’ve had other excellent mentors to guide me through various aspects of my real estate investing business. But he’s the main one.
Bottom line is Wade Cook was instrumental in my development and success as a real estate investor. And I thank him for that.
Does that make my real estate investing success a fluke? Was his training all a scam? Does that make me a scam?
I think, as I always have, that if you find a mentor you resonate with then learn everything you can and run with it. Your success is your responsibility. So is your lack of success. Which one will you choose?
I respect you for your ethics and what you have taught me. I also respect you for owning up to the fact about Wade Cook. He had been around for many years and he is not the only one to go a foul of the law. The are many BIG name GURU’s that have taught strategies that are less than stellar, but have gotten away with them and others who have not. I applaud you. Thanks for all you do. Darlene
Thanks Darlene!
wade is not my mentor but the origional version of the book you mentioned above was my inspiration to start buying houses with assumeable loans and then wrapping them on the resale for cash and cashflow.
That was 1987 and 23 years later and 300+ houses later Iam still doing “subject to” purchases with an owner financed “wrap” resale. Last month we did 10 and the tax credit made for some substantial downpayments. Sorry to hear about his problems but he’ll be back bigger than ever.
Hey Susan,
I also credit Wade for my start.. always have… Wade was able to teach the fundamentals about business, real estate, and stocks better than anyone else…
And since then I still study his ability to build and info company…
I think that had Wade, sold out his company at the peak when his company was worth 100 mil plus… he would wrote the check to the IRS… and been done..
And my point is… that when the government went after him for whatever reason… It’s over…
Once you are in their sights… it’s pretty hard to get out of them and they’ll find something…
For all of us… as a friend of mine
has taught me…. if we knew when to sell
and simply ride out the bad times..
or rather if we knew when the peak was and sold out… it would be easy…
So, many people disregard good information
because someone makes a mistake…
They seem to forget we are all human…
And at some point we’ll all make some pretty sizable mistakes…
count on it..
Great Post… !!
When I was starting out in the 90s, I used to watch Wade “religiously” every weekday on TV in LA, and learned a lot from him. I made (and lost) the fastest investment money I ever saw, with Wade. I took a real liking to him and his style, and sure hope Tom is right — that Wade Cook will be back, bigger and better than ever. My best wishes for him.
Thanks for being honest about your training with Wade Cook. In the mid-90′s I read Wade’s book on options trading. Never paid for the seminar because the book was pretty straight forward. Using call options on stocks that were splitting I made a bundle. In three months on short call option trades I made $40,000 on a $10,000 investment. I thought I found the golden goose. Then the 1997 Asian market crash occurred. The whole market was dragged into the toilet. Before I could get a handle on how Puts worked, I lost most of it. Was that Wade’s fault? No. It was mine. You can take a course on how to swim or read a book about it. But until you actually jump in the water over your head and actually swim you aren’t going to know. IRS aside, I think a lot of people who are mad at Wade got burned because they weren’t ready, there timing was off or whatever and wanted someone to blame instead of taking an honest look at themselves. However, that doesn’t excuse him avoiding paying his taxes. Sorry to hear he and his wife chose that route.