Even if you haven't seen the movie or read the book, both of which are based on his life, by now you might already be familiar with the story of Jordan Belfort, on whom "The Wolf of Wall Street" is based.
At 27, the Bronx, New York native founded a brokerage firm called Stratton Oakmont in 1989 with partner Danny Porush. Stratton Oakmont made its name by selling hyped shares of businesses that the firm personally invested in, only to sell the firm's own shares once the prices were inflated by their own salesmanship, leaving their clients with the losses as soon as the prices dropped back down to earth.
In layman's terms, using what's called a classic "pump and dump" scheme, Belfort screwed his own customers to the tune of $200 million with no remorse.
The nature of the books and movie based on Belfort's career of scum-bagging is beyond outrageous but, by all accounts taken, very much true. So now question remains, how did he do it? How could one firm be solely dedicated to ripping off every investor that it called up and actually prosper for a multitude of years?
For one, the lack of connectivity throughout the world probably helped Stratton's cause. This was, lest we forget, the early 90s. There were little to no public forums on which victims could alert others and news didn't travel as fast. And on the few occasions that a broadcast danger did arise, Belfort was likely to swiftly swat it away.
Indeed the L.A. Times did report of a $200 million libel lawsuit filed by Stratton Oakmont in 1995 against Prodigy Services Co., which controlled an online forum that featured 2 million subscribers, one of which made "offensive" remarks about Belfort's company and its business practices.
Belfort dropped the lawsuit once Prodigy apologized and Prodigy, in turn, stopped their own investigation into Stratton's business practices (with no need to prove that what Belfort regarded as "libel" was actually the truth). Had Prodigy continued its digging, it would have likely found out what the world knows now. Stratton Oakmont was full of professional lying cheats.
Once the two business partners assembled their ranks, it was only a matter of showing them the light, ironically to the darkest methods in the financial world.
Gaining investors' trust and sounding like a legit firm by name-dropping some of the biggest companies in the world was the name of Belfort's game. Then came the promotion of bogus stocks. And when investors wouldn't bite, there was always the constant pestering to resort to.
There was simply no getting out of conversation with Stratton Oakmont stock brokers until they got their way, especially if an investor had a deep sense of greed inside of them. However buried and hidden, Belfort knew he could get to it. The head-man in charge even went to the lengths of printing well-detailed scripts that had a response for every rebuttal a potential client offered.
Insults, badgering, misogyny: Belfort would seemingly stop at no lengths to pressure clients into sending him money. There even are accounts of brokers declining to sell shares that would make customers a profit, even when those same customers had blatantly asked them to.
It might sound like a shocking revelation, and rightly so. Everything about the way in which Belfort conducted himself in the early 90s was shocking. The Wolf was so intent on catching his prey, even if it cost his victims their financial lives.
Unfortunately, too many investors caved in, willing to buy, while it took just too long for the government to ensure that Stratton Oakmont and their heavy-handed tactics died.
Top Photo Courtesy: Movioia