How exactly was Jordan Belfort scamming people and why did it work successfully till his demise?

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How exactly was Jordan Belfort scamming people and why did it work successfully till his demise?

In: Economics

I dont know how accurate was the movie, but at least it looks that he got screwed because he was a drug addict and failed to do what his lawyer said.

As I understand it he would basically pump and dump stocks. So he would find a cheap stock and buy up alot of it causing the price to inflate then he would hype it up to investors through false information and falsified financial statements of that company and get them to buy in as well at the higher price which inflates it even more. Then he and his brokers would sell their shares at the inflated price which causes the stock price to tumble and they’d just reap the profits of buying low and selling high.

He got away with it for a while basically because nobody who knew said anything because they profited as well. His success and party lifestyle eventually causedd the SEC to be suspicious and they started to investigate and the rest is history.

Moral of the story: if you’re getting rich through illegal means, don’t flaunt it and draw attention to yourself