Jordan Belfort: How He Became the Wolf of Wall Street
NEW YORK – DEC 17: Jordan Belfort attends the premiere of “The Wolf Of Wall Street” at the Ziegfeld Theater on December 17, 2013 in New York City.
Born in 1962, Jordan Belfort is a Bronx native who has made quite a name for himself in the world of trading. Growing up, Belfort started making money at a young age. Together with one of his childhood friends, Belfort sold Italian ice to people along a local beach.
That summer he and his friend sold $20,000 worth of Italian ice treats. Later in his 20’s, Belfort started a door-to-door meat selling business. He sold 5,000 pounds of meat in the first week of operation. But those feats are nothing compared to the millions of dollars he made trading penny stocks.
How Belfort Made His Millions
In 1989, Belfort started the securities firm Stratton Oakmont that was a division of Stratton Securities. Here, Belfort would begin developing his skills as a penny stock trader and began promoting penny stocks to other investors. But things began to take a turn for the worst when Stratton Oakmont started operating the firm as a boiler room.
During the boiler room days, Belfort would promote penny stocks through intensive marketing which drove up the price of these stocks. Then, Belfort would instruct his team of investors to dump the stock making him millions of dollars over time. At their highest point, Stratton Oakmont employed 1,000 traders who were responsible for issuing stocks that totaled over 1 billion dollars.
These fraudulent actions cost investors millions of dollars, and this quickly got the attention of the authorities. Belfort’s pump and dump days were over with when Financial Industry Regulatory Authority permanently shut down his firm in 1996. Belfort was charged with securities fraud in addition to money laundering, which sent Belfort to prison, but as you will learn below, he did not spend much time there.
Belfort Goes to Prison
After being found guilty of securities fraud and money laundering, Belfort was taken to Taft Correctional Institution to begin a four-year prison term. But after working out a plea deal with the FBI for his cooperation, he got released after serving 22 months.
Part of the plea deal ordered Belfort to pay back 110 million dollars to investors whom he defrauded during his pump and dump operations. This would require Belfort to pay 50% of his future income back to investors. But later after a few court hearings, a judge ruled against the 50% and ordered Belfort to pay a set amount of $10,000 a month. Belfort agreed to this amount and appeared to be happy with this ruling.
The Wolf of Wall Street Makes a Come Back
After his time in prison, Belfort turned over a new leaf and wrote two books; The Wolf of Wall Street and Catching the Wolf of Wall Street. The Wolf of Wall Street was made into a movie and received rave reviews from many movie reviewers.
Now Belfort is a public speaker who travels around the country speaking at various venues, and he often talks about his days in the boiler and the mistakes he made in this past. Surely Belfort has learned his lesson and he appears to be leading a happy and productive life today.