Professionalism/Jordan Belfort and Stratton Oakmont
The story of Jordan Belfort and Stratton Oakmont became popularized when Martin Scorcese released his film The Wolf of Wall Street. The film depicted the revelrous behavior of Jordan Belfort, portrayed by Leonardo DiCaprio, and the other executives at Stratton Oakmont. While a life of sex, drugs, and parties made for a high grossing film, stealing money from unsuspecting clients should be at the epicenter of any discussion on Jordan Belfort, and the Wolf of Wall Street did not give this enough attention. Through his penny stock boiler room, Belfort stole over 200 million dollars from investors. Belfort's obsession with making money combined with no thought of long term sustainability led to this behavior. The ethical boundary was continuously being pushed to new limits as Belfort and Stratton Oakmont saw immediate monetary success resulting from their fraud. In the words of Belfort, "its easier to get rich quick when you don't follow the rules." 
Stratton Oakmont fraud and conviction
Stratton Oakmont Inc. operated as a boiler room that sold penny stocks. It was founded by Jordan Belfort and Kenny Greene, and was later bought by Danny Porush. The company made millions illegally by defrauding its investors using a "pump and dump" operation. Belfort and several of his executives would artificially inflate a particular company's stock and then have an army of brokers sell it to unsuspecting investors. This would cause the stock to rise, guaranteeing Belfort and his associates a substantial profit. Soon, the stock would fall back to reality, with the investors bearing a significant loss. The brokers would follow a script that Belfort had written himself using high pressure sales tactics. They first would approach with a well known stock to gain the clients trust. Then once the client had created an account with Stratton Oakmont, the brokers would sell them an inflated stock. At its peak in the 1990s, the firm employed more than 1,000 brokers. The employees were urged to live by the motto, "Don't hang up until the customer buys or dies." Belfort personally took over $200,000,000 an estimated 1,513 investors, many of whom earn normal wages. For example, Dr. Alfred E. Vitt, a retired dentist, reportedly lost $250,000. Like Vitt, many other investors reported similar losses.
The U.S. Securities and Exchange Commission learned of Stratton Oakmont's illegal actives and began investigating them in 1992. Two years later, the company reached a settlement with the SEC agreeing to a lifelong ban from working in the securities industry. Further legal trouble followed in 1996, when the National Association of Securities Dealers ejected Stratton Oakmont from its association. The company was ordered to be liquidated and to off its fines and settlements the following year. Belfort pleaded guilty to securities fraud and money laundering. In 2003, he was sentenced to 4 years in prison and charged a $110 million fine. He only spent 22 months in jail and has yet to fully pay back his fine. Danial Porush, who took over Stratton after Belfort, was ordered to pay $200,425,851.31.
On July 8, 2003, Jordan Belfort was sentenced by John E. Gleeson to restitution of $110,362,993.87 at a rate 50% of his gross annual income plus interest. Upon his release from prison, he was to begin these payments and endure a three year supervised release period. As of October 4, 2013, he has paid $11, 629,143.64, 10.4 million of which were forfeited funds. According to a report from 2008, 362 of 3,378 former Stratton customers (not limited to just Belfort's clients) who have filed claims have received restitution after filing claims with the Securities Investor Protection Corporation. Lorretta, E Lynch, United States Attorney of the Eastern District of New York, requested that Gleeson find Belfort in default of his restitution payments, due to his failure to pay his restitution at the mandated annual rate. This includes 2010, a year when he did not make any payments at all toward his restitution. Belfort and his attorneys argued that they were no longer bound to the 50% annual rate after the supervised release period. As of 2008, 362 of 3,378 former Stratton customers (not limited to just Belfort's clients) who have filed claims have received restitution after filing claims with the Securities Investor Protection Corporation. In October of 2013, federal prosecutors withdrew their default request to negotiate a new settlement with Belfort's lawyers. That year Belfort was also accused of illegally relocating to Australia to hide his assets; however, US attorneys retracted that accusation as well. 
Life After Prosecution
After being released from prison, Jordan Belfort wrote two books, The Wolf of Wall Street and Catching the Wolf of Wall Street, based on his life before prison. Red Granite, a Los Angeles based production company, purchased the rights for these titles from Belfort for $1,045,000 of which $250,000 went directly to restitution payments. The film, "The Wolf of Wall Street," was highly successful, grossing 66.1 million dollars in its first two weeks. Belfort adamantly claims that 100% of his income from the film will go to the Stratton victims. 
Belfort now travels the world as a motivational speaker. He teaches his "Straight Line Persuasion" technique, a technique modeled by his persuasion methods at Stratton Oakmont, to thousands of businesses; and in many of his talks, he emphasizes the importance of morals in business. He has worked with roughly 395 businesses, including Virgin America, Delta Airlines, and the Melbourne Storm, and offers three different speaking packages— 3-hour speeches, 3- day intensive training programs, and ongoing consultations.  Because of the Privacy Act, 5 U.S.C. 552a, most of his financial records have been kept under seal by the government; however, many have estimated that he earns $30,000 per speech. In a recent article, he said he makes "as much as fifty grand" for one of his speeches. In addition to his in-person talks, he offers DVD, costing up to $1,997.00, to anybody wishing to learn his "Straight Line Persuasion" technique.  Belfort also has ownership in two companies: Wolf Holdings and Global Motivation. Jordan Belfort owns 50% of Global Motivation, which makes $110,000 in revenue annually.  
Although many of his assets were forfeited to the government, Belfort’s new profession has allowed him to continue living an extravagant lifestyle. He is currently living in a 4,000 square foot beachfront home, estimated to be worth $3,593,724, in Hermosa Beach, CA. 
The Wolf of Wall Street made Jordan Belfort a celebrity in both a positive and negative light. On Facebook he has almost 100,000 doting fans who absorb posts of his lavish lifestyle, videos of his motivational speeches, and advertisements for the Wolf of Wall Street books and movie. You can see these people's admiration for Belfort in comments such as, "seen ure movie last night and read the book jordan what a inspirational story and very talented guy, i could read ure book again, good that ure helping people today." On the other hand, Joel Cohen, the lead prosecutor in the Stratton Oakmont case, believes that the film portrays Belfort too sympathetically and in the end advertises Belfort as a motivational speaker. In addition, many of Belfort and Stratton Oakmont's victims are upset by Scorsese's film, which hardly mentions the pensions and life savings stolen from them.
Belfort uses social media to promote his efforts towards fulfilling his restitution obligations, but he is once again lying to his unsuspecting followers. On Facebook Belfort posted, “For the record, I am not turning over 50 percent of the profits of the books and the movie, which was what the government had wanted me to do. Instead, I insisted on turning over 100 percent of the profits.” In reality, Belfort received $940,000 for selling the film rights to his books and of that paid $21,000 in restitution and then received $24,000 dollars in an income tax deduction. Belfort actually profited from his restitution, but it is apparent that he can still find people to buy his deceitful products.
Greed and Impulsivity
It is apparent that greed played a substantial role in Belfort's decision making, but greed alone is not sufficient. Reflecting on his time at Stratton Oakmont, Belfort said, "it was my desire for instant gratification. I wanted money now". Belfort's desire for instant gratification led to a toxic and unsustainable business. Someone equally greedy as Belfort, but with a longer time horizon, might not have engaged in this type of business. Time horizon's are reflective of a person's impulsivity and play a huge role in decision making. With greed, the time horizon defines when a person would like to maximize their wealth. Belfort's time horizon was immediate and lacked any sustainability. This immediate time horizon is necessary for a pump and dump business. A pump and dump relies on the fact that new clients will always be available to replace the ones that have been plundered. However, as the pool of potential clients gets smaller and the firm's reputation worsens, finding new clients becomes a more difficult task. In addition, as the pump and dump becomes more successful, the scrutiny of the law increases. While Belfort was not indicted until 1998, by 1994 Stratton Oakmont made headlines with a fraud settlement of 2.5 Million dollars. While this case was settled, recently elected Alabama Securities Commissioner, Joseph Borg, had begun leading a multi-state task force with the sole objective of prosecuting Belfort and Stratton Oakmont. The unsustainable nature of this business shows that greed alone did not drive the unethical behavior. Belfort's short time horizon and impulsivity was a necessary ingredient.
Belfort is not alone in being impulsively inclined to cheat for financial gain. The presence of wealth has been proven to increase people's tendency to cheat, and it is exacerbated by environments consisting of performance based reward systems and money centered cultures . The incentive system Belfort created for his brokers was virulent, and the culture made money omnipresent. This incentive system offered huge commissions to its brokers, and created a business where there was no necessary duty for brokers towards clients. Because penny stocks have a 50% commission, the success of companies Stratton Oakmont sold was irrelevant since Stratton Oakmont had already profited. In addition, Stratton Oakmont was known for its overindulgent office parties and corporate retreats. Belfort wanted money to constantly be on the minds of his employees. This tumultuous environment created an unethical and unsustainable business.
Belfort's Revised View on Ethics
Belfort states in an interview that often ethics get in the way of short term profits. He blames his actions on a combination of bad luck and a desire for instant gratification. In another interview with the Daily Mail, he explained, "I'm a wolf who became a more benevolent character." He has recently developed the "Straight Line Persuasion System" that teaches people the art of persuasion. He claims that the system is so powerful that it can be used to manipulate people, as he did prior to his arrest. On the sales website for the program he says that he used the same tactics for the wrong reasons, and claims to have straightened up his act.
This new Jordan Belfort is a changed man. His professional mantra has taken a moral 180 to become: "Success in the absence of ethics and integrity is not success, it’s failure." He believes himself to be more valuable as a ethics proponent because he learned his lesson the hard way. He further states the his writing his book caused him to do a lot of self-relefction and to see fault in his values. In an interview with an austrailian newspaper he stays “... I lost my ethical way and I destroyed myself because I was missing other parts of the equation. When I wrote my book I was able to really see what my mistakes were, what my values were, and at the heart of my mistake was that my values were bankrupt.” On the other hand, it is unclear whether Belfort has truly reformed. On the "About Jordan" section of the website where Belfort sells his "Straight Line Persuasion System," he brags about the amount of money he was making at Stratton Oakmont. He associates that success with his sales and managerial skills and does not mention the involvement of fraud. It is apparent that Belfort remains deceptive in selling his products and unclear whether Belfort truly is a changed man.
- Antilla, Susan. Investors’ Story Left Out of Wall St. ‘Wolf’ Movie. http://dealbook.nytimes.com/2013/12/19/investors-story-left-out-of-wall-st-wolf-movie/?_php=true&_type=blogs&_r=0
- Jordan Belfort. https://www.youtube.com/watch?v=YSU1GUD-NF4#t=1m40s
- Eaton, Leslie. New York Times. "2.5 MILLION IN PENALTIES FOR LI BROKERAGE FIRM." February 3, 1994.
- Francesca Gino, Lamar Pierce, The abundance effect: Unethical behavior in the presence of wealth, Organizational Behavior and Human Decision Processes, Volume 109, Issue 2, July 2009, Pages 142-155, ISSN 0749-5978