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- [00:00]
Nicole Lapin
Foreign. This is Crime House. Wall Street's not just a place, it's a state of mind, a physical embodiment of the idea that profit is everything. No one goes to Wall street with the hopes of making just a little bit of money. It's about making as much money as humanly possible. That was especially especially the case back in the 1980s and nobody could make money quite like Jordan Belfort. With his insight into the stock market and a gift for motivational speaking, Jordan built a company that could finance the lifestyle he always wanted, but it still wasn't enough. In his quest for eye popping amounts of cash, his fantasy turned into a waking nightmare. One that defrauded investors out of hundreds of millions of dollars and nearly killed him in the process on several occasions. As they say, money makes the world go round. What many don't talk about is the time it made people's worlds come to a screeching halt. Whether it's greed, desperation, or the thirst for power, money can make even the most unassuming people do unthinkable things. And sometimes those acts can be deadly. This is Scams, Money and a Crime House Original. I'm Nicole Lapvin. Every Thursday we'll alternate between covering infamous money motivated crimes and gripping interviews with the experts or those who were directly involved themselves. Crime House exists because of you. Please rate, review and follow Scams, Money and Murder for early ad, free access and bonus content. Subscribe to Crime House plus on Apple Podcasts. And for even more true crime stories in history, check out the show. This episode is all about Jordan Belfort, otherwise known as the Wolf of Wall Street. Today I'll tell you about how Jordan founded an unlikely stockbrokering giant that earned him hundreds of millions of dollars. Along the way, he broke countless laws, all in his quest to feed his addiction to money, drugs, sex and power. But the good times couldn't last forever. And when the party ended, Jordan's life was in shambles. Crime House Studios has released its first audiobook called Murder in the Media. Told through the lens of five heart pounding murder cases, this thrilling audiobook traces the evolving and sometimes insidious role the media has had in shaping true crime storytelling. Murder in the Media is a Crime House original audiobook. Find it now on Spotify.
- [03:09]
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- [03:44]
Nicole Lapin
For a man who'd acquired a name as fierce as the Wolf of Wall Street, Jordan Belfort had pretty humble beginnings. He was born on July 9, 1962 to a pair of accountants in the Bronx, New York. Though from a very young age, Jordan had a restless energy and a penchant for bucking authority. Even as a kid after his family moved to Bayside, Queens, Jordan didn't like being told what to do. He especially hated being told to go to bed. He hated it so much he essentially trained himself to fight sleep, which became a pattern for him well into adulthood. It was also clear from an early age that Jordan had a sharp mind and an enterprising spirit. He was always looking for ways to make a quick buck. Over the summers in high school in the late 1970s, Jordan and a friend sold Italian ices out of cheap coolers on the beach. But this wasn't your average summer job. They turned a $20,000 profit one summer. On the side, Jordan also grew marijuana in his bedroom closet. That is, until his parents caught him and he also tried to pass it off as a school project. While Jordan's business acumen was ahead of the curve, he was a late bloomer physically. By the time he was in high school, girls were already towering over him. So he thought the only way for him to get attractive girlfriends was to have a lot of money. And how was he going to do that? Well, Jordan's mom told him the only honorable way to make a lot of cash was to become a doctor. And at this point, Jordan was willing to play by the rules. So when he enrolled at American University in Washington, D.C. in 1980, he decided to go the pre med route. But in the end, he wanted something even more lucrative. After he graduated, 23 year old Jordan ditched the long game for a more immediate payout. Around 1985, he began selling frozen steaks and seafood door to door on Long Island. And he was good at it. Jordan was a smooth talker and he had a knack for clearing out his product. In fact, he made enough money in the food business to buy himself a Porsche that same year. And when he met a young woman named Denise Lombardo, he used that Porsche to Convince her to go out with him. His grade school theory that money would help him get the girls he wanted seemed to pan out. In 1985, the two got married. It was smooth sailing for a couple of years. But Jordan wasn't happy with the status quo. He was obsessed with growing his business and he went too fast too soon. By 1987 the meat business failed and Jordan declared bankruptcy at the ripe age of 25. He was forced to go back to the drawing board and decided to take another big swing. This time though, he wanted a much higher return on his investment. He was headed to Wall Street. In May of 1987 a family friend helped him get a trainee stockbroker job at a firm called LF Rothschild. As soon as the trading window opened, the office filled with a roar of voices on the phone. The energy was intoxicating. And just like that, Jordan was hooked. His boss Mark Hanna, gave Jordan some tips on how to thrive in the fast paced high stakes world of stock trading. First, lots of masturbation for stress relief and second, lots of cocaine for energy and speed. At the time, Jordan took the advice with a grain of salt because he didn't seem to need the help just yet. Jordan's Wall street career was off to a great start. The stock market was booming, investors were bullish and Jordan was on the way to making the kind of money he'd fantasized about. That is until a few months later when the industry took a devastating turn. On October 19th, 1987, stock markets crashed around the world. Fears that the dollar was being devalued globally created a huge pressure to sell stocks. But with everyone selling, it was hard to find buyers, which caused prices to crater. It was the largest single day drop in the history of the Dow Jones what would be known as Black Monday. For Jordan, what seemed like a cushy career path would was now a lot less certain. He was laid off from LF Rothschild and bounced around to a couple of different firms. But he didn't last that long at any of them. Finally, in 1988, 26 year old Jordan landed at a small brokerage firm on Long island called Investor Center. The company specialized in penny stocks or assets priced for under a dollar. It may have seemed like a step down, but. But Jordan was delighted to learn that brokers earned much higher commissions on penny stocks. While brokers who traded traditional stocks made a measly 1 to 2% commission, penny stocks often pulled in a whopping 50%. Plus they were generally less regulated than their blue chip counterparts, which left room for Some creative accounting. So Jordan used his time at Investors center to learn everything he could about the penny stock market. And that's when he met Danny Porush, a 31 year old college dropout who'd been working for a variety of small businesses. Like Jordan, Danny wanted to strike it rich, no matter what it took. Seeing Danny's ambition and his loyalty, Jordan took Danny under his wing as a trainee. But come 1989, Jordan was facing another roadblock. Investor center ran out of funds and was shut down by the sec. But Jordan quickly moved on. After a brief stint at another brokerage firm, he decided to start his own. Jordan took Danny with him as his right hand man. Together they set up a brokerage called Stratton Oakmont, headquartered in the aptly named town of Lake Success, Long Island. Jordan even brought on his accountant father, Maxwell Belfort, as chief financial officer. In hiring the rest of his staff, Jordan wanted other hungry, motivated young people like himself. Mostly men in their early 20s, sometimes even younger than that. To help all of these inexperienced newbies sound like polished salesmen over the phone, Jordan taught them his trusty cold calling technique. He told them that they should start by pitching well known trusted blue chip stocks. Meaning the high quality reliable shares. Think McDonald's, Apple, American Express. Then once the clients took the blue chip bait, Jordan had them pitch the riskier pink sheet stocks. The companies that don't list on major exchanges. So you're Nestle or Nissan Motor Company. Those came with big fish, fat commissions. For Stratton Oakmont. Jordan had the method down to a science. And every broker at Stratton was given a literal script to make the process foolproof. Jordan's motto was no one hangs up the phone until the customer buys or dies. Before long, Jordan's company was known as the place where new brokers started out making hundreds of thousands of dollars a year. Which meant recruitment took care of itself. Soon, young men and women, but mostly men, were knocking down the doors of Stratton Oakmont, begging for a shot. Even the Mafia sent people to Stratton to learn how it was done. Part of the secret sauce was being physically far away from Wall Street. For one thing, when it came to Long island stock brokerages, Stratton Oakmont was one of the only shows in town. So they had their pick of as many hungry employees as they wanted. For another, being far away from firms in Manhattan meant that Jordan had a captive audience. There was little risk of his employees schmoozing with people at other companies and running off to take a better offer. This allowed Jordan to exercise a huge amount of power over what he called his Strattonites. Once his company was firmly established, Jordan turned his focus to their investing strategy. To start, Jordan looked up cases where stock brokerages had gotten into legal trouble. Specifically, he wanted to know where other companies had gotten caught rigging the law and what they'd been busted for. The goal was to find the line between legal and illegal and stay just barely on the right side of it, or at least close enough that there would be plausible deniability. At first it worked. Jordan and his Stratonites found the sweet spot in terms of dubious legality and they made money hand over fist, all while thumbing their noses at regulators. But before long, Jordan and his merry band of brokers would take their questionable behavior too far. And it wouldn't be long before they ran afoul of the SEC and the FBI. By 1989, 27 year old Jordan Belford had founded his own stock brokerage firm called Stratton Oakmont. And right out of the gate, they were basically printing money. But it wasn't strictly legal. Jordan had found what he called a murky middle ground of stockbrokering, where the line between legal and illegal wasn't exactly clear. Strand targeted the richest clients they could and encouraged them to take risks in the highly speculative penny stock market. Normally, the SEC had rules in place to protect investors from dangerous situations like that, but they only applied to people trading with lower amounts, not the millions of dollars Stratton clients were putting in. It was definitely a loophole. And Jordan's company was barely squeezing through Was stressful work. And Strattonites had a lot of steam to blow off. They were the embodiment of the work hard, play hard culture. Jordan even began heeding the advice from his former boss, Mark Hanna, who told him that cocaine and some sex workers were good for morale and business. And so Jordan's company became notorious for over the top office parties featuring mountains of recreational drugs and bevies of beautiful women. It was at one of these lavish over the top parties where Jordan met 22 year old Nadine Caridi, a model who had been recently featured in a Miller Light commercial. Jordan began having an affair with her, eventually divorcing from his first wife Denise in 1991 and marrying Nadine that same year. Jordan and Nadine's wedding was a hugely expensive blowout. Jordan was pulling in about a million dollars a week by now, so it was no big deal to fly 300 of their closest friends and family out to a tiny car Caribbean island. That's where they proceeded to have a drug fueled rager. By this point, Jordan was also battling an addiction to Quaaludes, a highly addictive painkiller. At first, Jordan used them to manage the pain from a back injury. But even after his recovery, he was hooked. The perfect high wasn't the only thing Jordan was chasing, though. He also continued hiring sex workers even after he married Nadine. And he was feverishly spending his hard earned cash. Jordan bought the most expensive cars, houses, tailored suits and gold watches he could find. And he used company money to cover some of those personal expenses. Even more ridiculous, he wanted his employees to keep up with his monstrous spending habits, even though many couldn't afford to. But that was the point. Keep them in golden handcuffs so tight that they had to sell more stocks just to maintain their expensive lifestyles. And shockingly, almost everyone who worked there idolized him. In a way, Jordan was like a cult leader, inspiring them to sell more stocks than they ever thought possible. Jordan himself would later describe his hold over his employees as a kind of brainwashing. Meanwhile, Jordan harnessed his Strat Knights hunger for his own nefarious purposes. He directed his brokers to use aggressive sales tactics, Ones that essentially forced their clients to buy shares of certain penny stocks that Stratton itself owned in bulk. As more and more people snatched up a stock, the value went up, as did the value of Stratton's holdings. Then, at the opportune moment, Jordan would direct his employees to sell off large chunks of their position, which would cause the stock price to collapse. But that was fine, because Stratton, and by extension Jordan, had already made millions. Here's the thing, though. This pump and dump strategy of manipulating stock prices was against SEC rules, meaning it was pretty darn illegal. Which is why the SEC had been keeping an eye on Stratton Oakmont basically since they were founded in 1989. But in 1992, the commission finally had enough evidence to go after them for wrongdoing. They tried to nail Jordan and other Stratton leaders with charges of fraud and stock manipulation. But Jordan had outmaneuvered them. His strategy to focus on big money investors paid off. Once the SEC got a look at his books, they realized Stratton had managed to squeeze through the legal loophole that Jordan had found. So they were left in a bit of a standoff. And for the time being, the good times at Stratton continued to roll. But Jordan was playing another game on the side. He was skirting laws about how large an ownership stake he could have in a single company. And to do that, he used a system of nominees. Basically, Jordan would choose people close to him, family members and friends, and buy shares in their names. On paper, the stocks belonged to them, but in reality, Jordan was the one in control. He would then have his nominees sell the stocks and would give the owner some of the proceeds from the sale. But he would keep most of the profit himself. Using shady strategies like this, Jordan earned the nickname the Wolf of Wall Street. With his shrewd business mind and his ability to motivate employees, Jordan was pretty much unstoppable. It wasn't long before he was earning more than $50 million per year, and Jordan was spending the money almost as fast as it was coming in. He lived with his model wife, Nadine, on a luxe estate in old Brookville, Long Island. The couple had a nanny for their daughter, Chandler, born in 1993, as well as an electrician, a handyman, and a limousine driver on staff. They had six maids, two armed bodyguards, plus two full time marine biologists to manage the delicate ecosystem of their private pond. In other ludicrous displays of wealth, Jordan once landed his personal helicopter on his oversized back lawn. He said he was so stoned at the time, he had double vision and had to fly with one eye closed. Doesn't seem like he even had a pilot's license. Meanwhile, despite being under investigation by the SEC, Stratton Oakmont was going stronger than ever. By 1993, they were overseeing more than $1 billion in investments, which is worth about double that today. But Jordan didn't want all of his eggs in one basket. So that same year, he took a trip to Switzerland to inquire about accounts where he could hide his money, not just from the sec, but also from the FBI, just in case they ever came sniffing around. At the same time, Jordan went above and beyond to establish a paper trail. He even worked with a Swiss document forger who covered Jordan's tracks by setting up foreign shell companies. Jordan then put these companies in the name of his wife's aunt, a British national named Patricia Mallor. Then, to actually move those millions into his accounts, Jordan called in a favor from one of his drug dealers, whose wife was a Swiss citizen. Jordan had her and several of her family members smuggle $3 million into Switzerland to deposit it. The whole plot had him really excited. So excited that before he handed over the bills, he laid out the money on his bed and made love to his wife on top of it. Jordan was now playing an even more dangerous game. Between the overseas accounts and smuggling cash internationally. He was committing major crimes, namely money laundering. All in an effort to cover up the stock manipulation. In the meantime, the issue with the SEC was coming to a border boiling point. Though they were willing to play ball given the uncertain legal situation, they offered Jordan a deal instead of the estimated 22 million dollar fine they had originally sued for. Jordan could settle for just two and a half million, which was just a drop in the bucket for him at this point. But there was a catch. Jordan would be banned from ever running a securities company again. That would mean no more stocks, no more power brokering, no more multimillion dollar paydays, and no more running Stratton Oakmont, the company he had built from nothing. In January of 1994, Jordan's lawyer told him to take the deal. But Jordan stalled. And that's when things went from bad to worse. Around that time, 31 year old Jordan received a concerned call from his wedding photographer, of all people. He let Jordan know that the FBI had requested a copy of his wedding video, seemingly to help the SEC with its investigation into Jordan. It was clear that the government was trying to take him down one way or another. In an act of desperation, Jordan met with a friend who had an in at the FBI. He was hoping he could use his relationship to smooth things over at the bureau and make his legal troubles disappear. Except even Jordan wasn't well connected enough to shut down a federal investigation. But if he played ball with the sec, everything would likely go a lot easier for him. So Jordan had a decision to make. Settle, call it quits and walk away with a slap on the wrist. Or defy the SEC and the FBI, stay at Stratton and go for broke. In the end, he decided to settle. But as always, Jordan wanted his cake. And he was hell bent on eating it too.
- [24:57]
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- [25:27]
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- [25:59]
Nicole Lapin
After five years of running Stratton Oakmont like a drug free fueled, sex crazed, money making machine, the party finally came to an end. In 1994. After being hit with SEC charges of fraud and stock manipulation, 31 year old Jordan Belfort decided to settle. Under the terms of the deal, he had to officially step down as Stratton's CEO and accept a lifetime ban from ever running another securities company. His second in command, Danny Parouche, stepped up in his place. After years in the trenches together, Danny was still fiercely loyal to Jordan. So he was going to make sure his buddy was set up for life. Jordan and Danny cooked up a spectacular buyout. $180 million. 1 million per month for 15 years. Some of his advisors, including Jordan's own father, thought that was way too much. Given the legal trouble Jordan was in. That sort of payout didn't exactly show Jordan had been humbled or learned his lesson in any way. But that didn't stop Jordan from accepting the cash. And it didn't soften the blow of having to leave Stratton Oakmont either. Jordan said that giving his farewell speech to employees in February of 1994 felt like giving the eulogy at his own funeral. And to be honest, Jordan was challenging death. At this point, he was still very much addicted to a variety of recreational drugs, primarily Quaaludes. And now with all his free time, his drug use spiraled further out of control, which didn't exactly pair well with his growing legal troubles. Soon after resigning from Stratton, Jordan got his hands on a supply of 15 year old Quaaludes. The original formula had been banned by the fda, so these were a real find. He and Danny took some, but after not feeling the effects right away, they took some more. As they were still waiting for the drugs to kick in, Jordan got a call from his friend Bo Dietl, who had a connection at the FBI. Bo warned him that Jordan's phones had been tapped and that he needed to get a secure line where they could talk. So Jordan drove a mile down the road to a payphone. That's when Beau told him that the FBI had caught wind of his Swiss bank accounts. Now they were going after him for a full blown money laundering investigation. Just as he heard those words, the Quaaludes kicked in and they packed a more powerful punch than even Jordan could handle. Though he barely had control of his own body, he drove the short distance back home. He he was in such a drug induced fog that he didn't realize what happened until the police showed up at his doorstep a little later. It turned out Jordan had seven separate car accidents on his one mile trip home. Thankfully, the worst that happened was another driver getting a broken arm. But that day, Jordan was arrested for driving under the influence of reckless endangerment and leaving the scene of an accident. At the police station, he tested positive for everything from cocaine to marijuana to mdma. His high powered lawyers got him released on bail. But as soon as one problem was resolved, several more came up. In October of 1994, Jordan's aunt by marriage, Patricia Malone Lore, died. This was the woman whose name Jordan had used on his Swiss bank accounts. So that created a bit of a problem when it came time to move the funds around. Then a week later, Jordan heard that the Swiss banker who helped him set up those fraudulent accounts had gotten himself arrested for money laundering. As if that wasn't enough, Stratton Oakmont was struggling under Danny's haphazard leadership. In August of 1995, the company's finances took a dive and they could no longer afford to pay Jordan's million dollar a month paycheck. Even worse, customer lawsuits were piling up against Stratton and Jordan to the tune of $70 million. On a personal front, in October of 1995, Jordan had his spine fused as a last ditch effort to cure him of his debilitating back pain. But it didn't work. He leaned on Quaaludes even more heavily, taking around 20 pills a day. If he kept going at that rate, there was a good chance his drug use could kill him. But In June of 1996, he had a different kind of brush with death. Jordan was sailing his yacht off the Italian coast in high winds, which the captain had advised against. As the storm ramped up, the boat ended up going under the waves. Jordan, his family, friends and crew all had to be rescued by Italian naval special forces. Speaking of sinking ships, by that point, Stratton Oakmont was one of them. The firm was officially shut down in December of 1996 when the national association of securities Dealers removed them from their ranks. They were forced to liquidate their remaining assets. Though none of this bad news helped Jordan kick his drug habit. As his wife Nadine desperately tried to help him quit, he became convinced that she was going to leave, leave him and take their children with her. While he was high, he and Nadine got into an altercation and Jordan kicked Nadine down a flight of stairs. Jordan had hit rock bottom. He was arrested for being a threat to himself and others. And it was this wake up call that finally got him into rehab and on a path to sobriety. But this was just a battle in a very long war for Jordan. In 1999, the FBI finally indicted the 37 year old for money laundering and securities fraud. He was facing up to 30 years in prison, so he agreed to a plea deal which meant becoming an informant for the FBI. Jordan had to wear a wire and collect information from his Stratton Code co conspirators like Danny Perouche. He also had to testify against them in court and still face punishment of his own. The FBI estimated that during his tenure at Stratton Oakmont, Jordan could have cost his investors as much as $200 million in fraudulent or misleading stock purchases. He was ordered to pay back over 110 million million in restitution. Then in July of 2003, Jordan was sentenced to four years in prison for securities fraud and money laundering. Danny Perusch, along with some of Jordan's other associates also got prison time for their roles, though Jordan served his sentence in a relaxed minimum security facility in Central California. In prison, Jordan's roommate, the place didn't have cells was Tommy Chong of Cheech and Chong fame. Chong even encouraged him to write a memoir. During his prison stint, Jordan was released after just 22 months. He and Nadine tried to work things out, but ultimately they divorced in 2005. A couple years later, in 2007, Jordan followed Tommy Chong's advice and published his memoir, which he called the Wolf of Wall Street. Even before it was released, there was a Hollywood bidding war for the rights. The movie, directed by Martin Scorsese and starring Leonardo DiCaprio as Jordan, was released in 2013. But even with the movie rocketing him to worldwide fame, Jordan was still behind on his restitution payments. In 2013, only only about 10 million of the $110 million he owed had been recovered. Meanwhile, Jordan continued capitalizing on his experience by offering corporate sales training and investment courses. He also became a motivational speaker. In 2017, he released a self help book called Way of the wolf. Then in 2023, he followed it up with the Wolf of Investing, where he shared his strategies for making money on Wall street. As of 2023, his reported net worth is over $110 million. But he still needs to pay back close to 97 million to his former investors. And while Jordan's still taking financial risks, his personal life is more settled. In 2021, he remarried again, and he's remained committed to his sobriety for over 25 years and counting. As far as his addiction to money, only time will tell if Jordan Belfort has truly kicked the habit and subdued the wolf within. Thank you so much for listening. I'm your host Nicole Lappin. Scams, Money and Murder is a Crime House Original Join me every Thursday for a brand new episode here at Crime House. We want to thank each and every one of you for your support. If you like what you heard here today, please reach out on social media rimehouse and don't forget to rate, review and follow Scams, Money and Murder wherever you get your podcasts. Your feedback truly makes a difference. And for ad free listening plus early access and bonus content. Subscribe to Crime House plus on Apple Podcasts. Scams, Money and Murder is hosted by me, Nicole Lapin and is a Crime House original. Powered by Pave Studios, this episode was brought to life by the Scams, Money and Murder team. Max Cutler, Ron Shapiro, Alex Benedon, Lori Marinelli, Natalie Prasofsky, Sarah Camp, Noni Okologu, Joanna Powell and Michael Langsner. Thank you so much for listening. Ready to rethink everything you know about true crime? Check out Murder in the Media, the first audiobook from Crime House Studios. Find Murder in the Media on Spotify.