Born in Queens, New York, on July 9, 1962, Jordan Belfort had a natural talent as a salesman at an early age. At high school he earned with a friend 20,000 $ selling ice to people in a local beach. The money earned was suposed 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.
Belfort claims in his memoirs and in interviews with journalists that a family friend helped him find a job as a trainee stockbroker at the L.F. Rothschild firm,. 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. This is depicted in the film. Belfort claims to have then worked briefly for various penny-stock brokers before founding or taking-over (sources vary) Stratton Oakmont.
At some point, Belfort came to be in control of the brokerage firm Stratton Oakmont. While Belfort claims to have founded the firm, other sources say he and partners bought-out the original founder. In either case, Stratton Oakmont functioned as a boiler room that marketed penny stocks and defrauded investors with stock sales.
During his years as a fraudster, Belfort developed a lifestyle that consisted of lavish parties and intensive use of the drug methaqualone—sold to him under the brand name "Quaalude"—that resulted in a serious addiction. Stratton Oakmont employed over 1,000 stock brokers and was involved in stock issues totaling more than US$1 billion, including an equity raising 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.
The NASD began pursuing disciplinary actions against Stratton Oakmont in 1987, culminating in its permanent shutdown in 1995. Belfort was then indicted for securities fraudand money laundering.
After cooperating with the FBI, Belfort served 22 months in federal prison for a "pump and dump" scheme 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.
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.
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