The real life 'Wolf of Wall Street': behind the Scorsese film
Few watching The Wolf of Wall Street will have known that the real-life fraudster on whom it is based sold the film rights to his memoir of the same name – nor that hundreds of his real-life victims are still awaiting compensation. Jacqui Goddard hears from some of them
When Leonardo DiCaprio's new film The Wolf of Wall Street opened in Bob Shearin's home town of Manhattan Beach, California, the 66-year-old was one of the first to buy a ticket.
Released on Christmas Day in America, and in Britain on Friday, the film, directed by Martin Scorsese, came garlanded with praise by critics who called it "exhilarating" and "hilarious".
But Mr Shearin's interest in the film was nothing to do with the reviews or the lurid trailer which promised three hours of sex, drug-taking and depravity among a group of amoral stockbrokers in Nineties America.
Quite the opposite. The businessman wanted to see the film because he had first-hand experience of the events it depicted, as a victim of the real-life "wolf", Jordan Belfort.
Belfort, portrayed by DiCaprio, was founder and president of the New York investment banking firm Stratton Oakmont which, between 1989 and 1997, made outrageous profits – even by Wall Street's high standards – while conning small-time investors out of millions of dollars.
As one of them, Mr Shearin is appalled by the way the film seems to glory in its protagonist's crimes, playing his hedonistic lifestyle for laughs.
"The harm that was done to people around Belfort, and to the small investors, and what that meant – you see none of that," said Mr Shearin.
"His depiction in this movie is annoying and disturbing, because it makes him more into a mythical figure and skips the reality of what he was about. And what he was about was harming people financially."
Bob Shearin
Bob Shearin
Belfort's 1,500 victims, including Mr Shearin, are also furious that the con man, who has admitted he was a "greed-fuelled animal" while on Wall Street, has failed to pay back the money he scammed, despite a $110 million restitution order by a federal judge, part of his sentence for fraud and money laundering in 2003.
The victims, many of whom lost their life savings, are also disappointed that DiCaprio made a 30-second promotional video for Belfort's new motivational-speaking business in which the actor extolled him as a "shining example of the transformative qualities of ambition and hard work".
"It's really time for people to stop glorifying the crooks on Wall Street and for justice to be done," said Diane Nygaard, a securities and investment fraud lawyer in Kansas City, Missouri, who has represented a number of Belfort's victims.
"I was appalled at DiCaprio because he clearly doesn't have a clue as to the heartache this con man cost so many hard-working Americans … I wouldn't trust him for an inch. I think the film should be called 'My Adventures with other People's Money' because that's what it boils down to. You can steal more money with a pen than you can a gun."
Three hours long, with more than 500 utterances of the F-word, a feature-film record, The Wolf of Wall Street tells of the upstart New Yorker whose first business – a meat-selling enterprise – left him bankrupt at the age of 24. From the steak market he leapt straight into the stock market and two years later banked an income of $49 million – a sum he has complained about because "it was three shy of $1 million a week."
With such intoxicating wealth came a wild and decadent lifestyle. There were private jets, luxury mansions, bodyguards, champagne, wild sex – once while lying on a makeshift mattress comprised of $3 million in banknotes – poolside parties, prostitutes, and, in Belfort's words, "enough drugs to sedate Guatemala". At one point, he was hooked on 22 kinds, including cocaine and Quaaludes.
His first luxury car was a white Ferrari Testarossa. Later, he bought a vintage Aston Martin that he kitted out like James Bond's, complete with a gadget to scatter nails on the road to burst the tires of potential pursuers.
From its early beginnings in a spare closet at a used-car salesroom, Stratton Oakmont expanded swiftly until it was filled with the collective roar of 1,000 young stockbrokers, all urging investors over the telephone to buy.
But often what they were selling were empty promises. Between 1990 and 1997, Stratton Oakmont targeted customers in a classic scam called "pump-and-dump".
Brokers would buy up large blocks of small public companies, then hard-sell the remaining shares to artificially inflate the price, before dumping their own shares onto the market, causing the price to plummet. The scam made colossal personal profits for Belfort and his employees, but left investors' portfolios worthless.
"It started out as a phone call selling me good stock, one of the better brands that made me money, then after they had me hooked they started selling me nothing, just a lot of hot air," recalled Dr Alfred Vitt, 81, who ultimately lost $250,000.
Alfred Vitt (NY TIMES/REDUX/EYEVINE)
Alfred Vitt (NY TIMES/REDUX/EYEVINE)
"They were such high pressure people, very persistent – they wouldn't take 'No' for an answer. Sometimes you would just have to hang up on them but other times to get them off the line I'd cave in, unfortunately. Everyone wants to strike it rich, so I borrowed money and I went deep."
Stratton Oakmont's brokers made a minimum of $250,000 in their first year, progressing to seven figures by year three. Even the switchboard operator earned $80,000.
Among Belfort and his minions, nothing was taboo. The film opens with a scene in which crazed staff vie for a $25,000 prize in a dwarf-throwing contest; in another, a young female assistant has her head shaved before baying colleagues in exchange for a $10,000 breast implant.
Office sex got so out of hand that crude notices from the management were handed out declaring the premises a "F***-free zone" between the hours of 8am and 7pm.
"It was nothing short of a good old fashioned gold rush," Belfort recalls in his 2008 memoir, The Wolf of Wall Street, on which Scorsese's film is based. "They were drunk on youth, fuelled by greed and higher than kites. And day by day the gravy train grew longer."
The train finally hit the buffers in 1998 when the FBI and the Securities and Exchange Commission pounced. Belfort pleaded guilty to 10 counts of securities fraud and money laundering.
He was sentenced to four years in prison but was released after just 22 months, having cut a deal with prosecutors for leniency in return for turning over a number of cronies and agreeing to make restitution. Today, he claims to be a reformed man who has rediscovered his "ethical roots". He works as a motivational speaker, sells a $2,000 home study course in how to get rich quick "without sacrificing integrity" and hires himself out to companies including Virgin Airlines and Deutsche Bank.
Joel Cohen, a former federal prosecutor who led the case against Belfort, complains that Scorcese's film gives Belfort's new business free publicity, especially in the film's final scene, in which DiCaprio appears alongside the real-life Belfort. "What reason could they have for putting the real Belfort on screen as they did in front of a placard advertising his motivational speaking business?"
Jordan Belfort, photographed in his apartment in Manhatten Beach (LARRY ARMSTRONG)
Jordan Belfort, photographed in his apartment in Manhatten Beach (LARRY ARMSTRONG)
Last October the US Attorney's Office for the Eastern District of New York filed a motion into court asking for Belfort to be held in default of the restitution order. Of the $11.6 million collected against his $110 million debt, it stated, most came from the sale of seized assets and Belfort has paid just $243,000 over the last four years, despite receiving $1.7 million from his two books and the sale of the movie rights. He opposed the motion, arguing that the requirement to pay restitution has expired. The US Attorney's Office has since withdrawn the motion, in order to keep negotiations with Belfort open.
On his Facebook page, Belfort insists "100 per cent of the profits of both [my] books and the movie" are destined for the restitution fund.
"This should amount to countless millions of dollars and hopefully be more than enough to pay back anyone who is still out there," he states. "I am not making any royalties off the film or the books and I am totally content with that. My income comes from my new life, which is far better than the old one."
But Robert Nardoza, spokesman for the US District Attorney's Office for the Eastern Division of New York, countered: "Belfort's Facebook posts are inaccurate. The government has seen nothing to suggest that even 100 per cent of Belfort's profits from his books and movie would yield 'countless millions'. They would not be enough to cover the losses inflicted on the victims in this case."
Bob Shearin, who lost $130,000 to Belfort's scam, said Belfort had "managed to weasel out of" making the restitution payments, adding: "That makes me suspicious of the 'recovery' he's claiming."
It is a suspicion based on close observation of Belfort since he left prison; the conman's ocean-front home is also in Manhattan Beach.
"He's short, cocky, kind of strutting around," said Mr Shearin. "Maybe I should have some resentment but where would that get me? I'm not going to run up to him and say 'You're a scumbag.' He's just doing what he does. That's what scumbags do."
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