Belfort in 2010
|Born||Jordan Ross Belfort
July 9, 1962
The Bronx, New York City, U.S.
|Occupation||Author, entrepreneur, motivational speaker|
|4 years in federal prison, $110 million in restitution|
|Criminal status||Released April 2006 after 22 months|
|Spouse(s)||Denise Lombardo (divorced)
Nadine Caridi (divorced; 2 children)
|Conviction(s)||Securities fraud, money laundering|
Jordan Ross Belfort (//; born July 9, 1962) is an American author and former stockbroker who pleaded guilty to fraud and related crimes in connection with stock market manipulation and running a boiler room as part of a penny stock scam. Belfort spent 22 months in prison as part of an agreement under which he gave testimony against numerous partners and subordinates in his fraud scheme. He published a memoir, The Wolf of Wall Street, which was adapted into a film, released in 2013. It was directed by Martin Scorsese and starred Leonardo DiCaprio as Belfort. The truthfulness of Belfort's book and the film is a controversial subject.
Belfort was born in 1962 in the Bronx borough of New York City into a Jewish family. His parents, Leah and Max Belfort, are both accountants. He was raised in Bayside, Queens.
Between completing high school and starting college, Belfort and his close childhood friend Elliot Loewenstern earned $20,000 selling Italian ice from styrofoam coolers to people at a local beach. Belfort planned on using the money earned with Loewenstern to pay for a dental-school qualification and he enrolled in the Baltimore College of Dental Surgery; however, he left after the dean of the school said to him on his first day at the college: "The golden age of dentistry is over. If you’re here simply because you’re looking to make a lot of money, you’re in the wrong place." Belfort eventually graduated from American University with a degree in biology.
After graduating, Belfort became a door-to-door meat and seafood salesman in Long Island, New York. He claims in interviews and his memoirs that the business was an initial success; he grew his meat-selling business to employ several workers and sold 5,000 pounds of beef and fish a week. However, the business ultimately failed, as he filed for bankruptcy at 25.
According to his memoirs and interviews, a family friend helped him find a job as a trainee stockbroker at L.F. Rothschild. Belfort says he was laid-off after that firm experienced financial difficulties related to the Black Monday stock market crash of 1987, a claim repeated in numerous sources.
Belfort claims to have then worked briefly for various penny-stock brokers back in Long Island before founding or taking-over (sources vary) Stratton Oakmont.
While Belfort claims to have founded Stratton Oakmont with friends, other sources say he and his partners bought-out the original founder. In either case, Stratton Oakmont functioned as a boiler room that marketed penny stocks and defrauded investors with the "pump and dump" type of stock sales.
During his years at Stratton, Belfort developed a lifestyle that consisted of lavish parties and intensive use of recreational drugs, especially methaqualone—sold to him under the brand name "Quaalude"—that resulted in a serious addiction. Stratton Oakmont at one point employed over 1,000 stock brokers and was involved in stock issues totaling more than US$1 billion, including being behind the initial public offering for footwear company Steve Madden Ltd. The notoriety of the firm, targeted by law enforcement officials through virtually its entire history, inspired the film Boiler Room (2000), as well as the 2013 biopic The Wolf of Wall Street.
Stratton Oakmont fraud and conviction
The NASD (now the Financial Industry Regulatory Authority) began pursuing disciplinary actions against Stratton Oakmont in 1987, culminating in its permanent shutdown in 1995. Belfort was then indicted for securities fraud and money laundering.
Belfort served 22 months at the Taft Correctional Center in Taft, California in exchange for a plea deal with the Federal Bureau of Investigation for the pump and dump scams he ran that led to investor losses of approximately US$200 million. Belfort was ordered to pay back $110.4 million that he swindled from stock buyers. Belfort shared a cell with Tommy Chong while serving his sentence, and Chong encouraged Belfort to write about his experiences as a stockbroker. The pair remained friends after their release from prison.
At a motivational talk that he delivered in Dubai, United Arab Emirates (UAE) on May 19, 2014, Belfort stated to the audience:
I got greedy.... Greed is not good. Ambition is good, passion is good. Passion prospers. My goal is to give more than I get, that’s a sustainable form of success.... Ninety-five percent of the business was legitimate.... It was all brokerage firm issues. It was all legitimate, nothing to do with liquidating stocks.
According to federal prosecutors, Belfort has not honored the restitution requirement of his 2003 sentencing agreement. The agreement requires him to pay 50% of his income towards restitution to the 1,513 clients he defrauded. Of the US$11.6 million that has been recovered by Belfort's victims, US$10.4 million of the total is the result of the sale of forfeited properties. The sentencing agreement mandates a total of US$110 million in restitution.
In October 2013, federal prosecutors filed a complaint against Belfort, who received an income of US$1,767,203 from the publication of his two books and the sale of the movie rights—plus an additional US$24,000, earned from motivational speaking engagements completed since 2007—claiming that he had paid restitution of only US$243,000 over the previous four years. As of November 2013, to keep negotiations open, the U.S. government is not holding Belfort in default of his payments, but it is unclear when the full amount of the mandated restitution will be repaid.
As of January 2014, Belfort had paid only $11 million of his $110 million restitution debt. Prosecutors said that he had fled to Australia to avoid taxes and conceal his assets from his victims.
In May 2014, Belfort said he planned to pay off the remaining restitution through speaking fees by the end of 2014: "My goal is to make north of $100 million so I am paying back everyone this year.”
While Belfort also claimed on his website and elsewhere that "100% of the profit" from his books and the Wolf of Wall Street film was being turned over to victims. In June 2014, spokesmen for the U.S. attorney said Belfort's claim was "not factual."
BusinessWeek reported that of approximately $1.2 million paid to Belfort in connection with the film, Belfort had paid only $21,000 toward his restitution obligations.
By September 2014, the amount Belfort had paid toward his restitution debt still stood at $11.6 million.
Belfort wrote two memoirs, The Wolf of Wall Street and Catching the Wolf of Wall Street, which have been published in approximately 40 countries and translated into 18 languages. A movie based on his books opened in 2013, starring DiCaprio as Belfort, Jonah Hill, and Margot Robbie; the film was written by Terence Winter and directed by Martin Scorsese.
The former Assistant United States Attorney who prosecuted Belfort has said he believes some of the claims in Belfort's book were "invented", and he thinks the "motivational speaking" operation is a fraud.
Filming of Scorsese's adaptation of Belfort's memoirs began in August 2012 and the movie was released on December 25, 2013. Time magazine reported that many of the escapades depicted in the movie are consistent with Belfort's memoirs and what was written about him in Forbes articles, although some of the Forbes-related content was embellished. Belfort was portrayed by Leonardo DiCaprio, who won the Golden Globe for Best Actor, and was nominated for an Oscar for Best Actor for his performance.
During his time at Stratton Oakmont, Belfort divorced his first wife, Denise Lombardo (whose name was changed in the film The Wolf of Wall Street), and married Nadine Caridi, (whose name was also changed in the film) a British-born, Bay Ridge, Brooklyn-raised model he met at a party. With Caridi, he has 2 children. Belfort and Caridi ultimately became separated following her claims of domestic violence which were fueled by his problems with drug addiction and affairs with other women. They divorced in 2005.
Belfort was the final owner of the luxury yacht Nadine, renamed after Caridi, that was originally built for Coco Chanel in 1961. In June 1996, the yacht sank off the east coast of Sardinia and Italian COMSUBIN frogmen rescued all who were aboard the vessel. Belfort said he insisted on sailing out in high winds against the advice of his captain, resulting in the sinking of the vessel, when waves smashed the foredeck hatch.
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This was serious Mafia stuff, impossible for a Jew like me to fully grasp the nuances of.
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