Jordan Belfort and Danny Porush founded Stratton Oakmont in 1989, but the Long Island brokerage firm was more like a "fraternity" than a workplace, with wild parties, rampant drug use, and even company-provided sex workers.
Sash Alexander / Alamy Stock PhotoJordan Belfort, the “Wolf of Wall Street” who founded Stratton Oakmont.
Jordan Belfort, the infamous Wolf of Wall Street, surely needs no introduction at this point. From serving time in prison for defrauding investors out of hundreds of millions of dollars to writing a bestselling memoir about the ordeal that was adapted into the highly successful film The Wolf of Wall Street in 2013, Belfort’s life of debauchery and crime has been well chronicled. However, Belfort’s tale is just one part of the larger story of Stratton Oakmont, the brokerage firm where he committed the crimes for which he became infamous.
Belfort founded Stratton Oakmont with his business partner, Danny Porush, in 1989. The firm caught the eye of the National Association of Securities Dealers (NASD) from its earliest years, and in 1996, it was shut down for fraudulent practices. Belfort, Porush, and their employees engaged in a “pump-and-dump” scheme in which they artificially inflated the prices of stocks owned by Stratton Oakmont before quickly selling them off, leaving their clients with worthless investments.
At its peak, the firm employed more than 1,000 people. Some of them were just as complicit in securities fraud as their bosses — and others were simply swept up in a situation they’d never imagined possible. In both cases, the insight former Stratton Oakmont employees have provided into the firm’s culture and the truth about what happened behind the scenes is shocking.
From the perspective of Jordan Belfort and the people who worked for him, this is the story of Stratton Oakmont.
How Jordan Belfort And Danny Porush Made Millions By Defrauding Investors
Personal PhotoJordan Belfort, his second wife, Nadine Caridi, Nancy Porush, and Danny Porush.
Given what he ultimately became, it may come as a surprise that Jordan Belfort originally wanted to be a dentist.
In fact, he studied biology at American University with that intention, but he ultimately left dental school on the first day after being told that the career was no longer a path to wealth. Instead, he started selling meat and seafood door-to-door, which eventually bankrupted him. Belfort then pivoted to the stock trading business as a trainee broker at L.F. Rothschild.
Around that same time, he met Danny Porush, a relatively average guy who had dropped out of college. Belfort bragged to Porush about how much money he was making selling stocks out of a boiler room — admitting that it was “half a scam” — and sold him on the idea of starting their own firm.
Two months later, in 1989, that plan came to fruition as the two men founded Stratton Oakmont on Long Island. They made money by effectively lying to investors about the value of penny stocks and then selling their own holdings at a profit. It was a classic “pump-and-dump” scheme: Investors bought worthless shares, and Porush and Belfort became rich. In 1991, Forbes writer Roula Khalaf described Belfort as a “twisted Robin Hood who takes from the rich and gives to himself and his merry band of brokers.”
Much of what followed was dramatized in The Wolf of Wall Street: wild parties, lots of Quaaludes and cocaine, luxury cars, yachts, and private planes. Of course, it all eventually came crashing down when Stratton Oakmont was expelled from the NASD and Belfort and Porush pleaded guilty to securities fraud and money laundering.
Belfort wound up serving 22 months in prison and was ordered to pay $110 million in restitution to those he defrauded. He later reinvented himself as a motivational speaker and an author. Porush, on the other hand, only continued to get himself into legal trouble, including working with a company that faced allegations of Medicare fraud.
However, while the lives of Belfort and Porush are well known, the stories of the people who worked with them aren’t as prominent. A few former Stratton Oakmont employees have spoken out about their time there — and their recollections show just how outrageous the firm really was.
What It Was Like To Work At Stratton Oakmont
Josh ShapiroJosh Shapiro, a former employee at Stratton Oakmont.
In 2013, shortly before The Wolf of Wall Street hit theaters, a former Stratton Oakmont employee named Josh Shapiro sat down with the New York Post to talk about the environment at Stratton Oakmont.
“I was blown away by the intensity — you could feel the pulse when you walked into the place,” Shapiro said. “It was like walking into a nightclub without the music. The music was the phones and the people talking. The energy was just unbounding and unstoppable, and you wanted to be a part of it. It was almost cultish, and you were hooked in from day one.”
Another former employee, Dwayne Jackson, has also spoken about his time at Stratton Oakmont on his own YouTube channel.
In various videos, Jackson described his two years with the company, saying that he was “just a kid” when he started at Stratton Oakmont in March 1994. “I didn’t know much about what I was selling” or “what was going on in the back office,” Jackson recalled. He said that his first paycheck at Stratton Oakmont was for $11,000 — and that upper management encouraged employees to spend their money as quickly as possible.
Dwayne Jackson/YouTubeDwayne Jackson, another former Stratton Oakmont employee.
Shapiro echoed a similar sentiment, describing how some of the managers at Stratton Oakmont would destroy $100 bills as a way to encourage employees:
“They’d give meetings in the back to the cold callers where they’d rip up $100 bills, throw them on the floor and tell them, ‘Do you want to be a loser all your life, or do you want to make something out of your life? Do you want to be rich?'”
Although Belfort often receives most of the attention for his antics, Shapiro said Porush was just as inflammatory and wild: “Porush gave meetings where he’d insult people, based on their performance. He would say: ‘Doug, you sold 1,100 shares of stock in the last three weeks. You know, you should have slit your throat when you were shaving this morning.'”
As a cold caller and front office worker, Jackson didn’t witness much of the debauchery at the firm, but he certainly saw some things that were atypical for an office environment.
“One day, it was a Jewish holiday, and a lot of the Jewish guys in the office wanted to leave early. It was like a Friday,” he said in one video. “And [a manager] gave this huge speech — he was definitely high on something — about how we’re all stockbrokers and we’re all going to Hell. He stood up on a desk and he held up his wallet in the air and he said, ‘Do you guys believe in God? This is God. My wallet is God.'”
However, in 1996, the seemingly infinite flow of money came to a harsh stop when Stratton Oakmont was forced to close its doors — and the fall of the firm was just as messy as its business dealings.
The Downfall Of Stratton Oakmont That Left Employees And Investors Broke
Warner Bros. PicturesLeonardo DiCaprio as Jordan Belfort in The Wolf of Wall Street.
Considering that Stratton Oakmont had defrauded hundreds of people, it only makes sense that those clients were left in a financial hole when the firm was forcibly shut down. However, it wasn’t just investors who were burdened. While Belfort was ordered to pay back $110 million, things mostly worked out okay for him.
Still, he and Porush had encouraged their employees to spend their money as quickly as they could — and those who listened soon found themselves equally strained.
“I didn’t save any money,” Shapiro said. “I spent it as fast as it came. I never bought any property — I didn’t think it was going to end. Property? The future? No. The future was right here and now… But eventually, the blindness from the drugs, the girls and the cars, the clothes and the money, wore off. These people were some of the worst people that I have ever met in my life — they would sell their own grandmother in a second.”
Shapiro left just a few months before Stratton Oakmont closed, but he didn’t mince words. He compared Belfort and Porush to Bernie Madoff, with one exception — the guys from Stratton Oakmont “have gotten off easy” in comparison.
Sash Alexander / Alamy Stock PhotoTo teach sales, Belfort would ask his employees at Stratton Oakmont to “sell me this pen.”
Belfort has also spoken extensively about that period in his life, strongly condemning his past behavior. Still, many people ask him for advice in marketing and sales, missing the point of Belfort’s narrative. The story of Stratton Oakmont isn’t a guidebook on how to get rich; it’s a cautionary tale about the corruption of money and greed.
“In retrospect, [jail] was the best thing to ever happen to me,” Belfort said in an interview with BusinessLIVE in 2014. “Because it forced me to re-examine myself, my value systems, my beliefs, and then, of course, I started writing the book when I was in jail so that changed everything… I don’t think that without that… I’d be one-tenth of the human being that I am today.”
Jackson and Shapiro expressed similar sentiments. They aren’t fully regretful of their time at Stratton Oakmont, but they are aware that they needed to make changes to improve themselves.
“If you’re going to get into sales, find something that you like, something that you’re passionate about, and preferably something that helps people at the same time,” Jackson said. “I did things to people that they didn’t want to be done, or I forced them into stuff. But the karma comes back.”
“When I am giving back,” Shapiro said, “I get a good feeling — I feel like I am absolving myself. But the guilt follows you a little bit, still.”
After learning about Stratton Oakmont and how it made Jordan Belfort rich, learn all about the life and crimes of Salvatore Maranzano, the Mafia’s “boss of all bosses.” Then, explore the rise and fall of Atlantic City through 33 photos.
