Bright Lights Film Journal

Punishing the Wolf of Wall Street: Jordan Belfort’s Second Act

Leonardo Di Caprio as Jordan Belfort in The Wolf of Wall Street

“According to documents provided by the US Department of Justice, in the year he received almost $1 million for the rights to his memoir, Belfort made restitution payments totaling just $21,000.”

With five Oscar nominations, four BAFTA nominations, and over $300 million in international box-office receipts, The Wolf of Wall Street has become an unequivocal success for director Martin Scorsese and production company Red Granite Pictures. As an adaptation of the real-life criminal exploits of pump-and-dump mastermind Jordan Belfort, the film received considerable criticism, seen by many as an at best amoral glorification of a decidedly immoral human being. While the debate surrounding the film will likely continue for some time, one thing is certain: Belfort made a lot of money out of it. Questioning the ethicality of glorifying Belfort’s life may be somewhat redundant in an industry with a long history of turning criminals into onscreen heroes, but the ways in which these films can often directly profit their subjects is much more problematic, and even more problematic for legal systems to respond to.

Since his release from prison, Belfort has built a new fortune for himself through his books, motivational speaking tours, and now from Scorsese’s dramatization of his life. While an individual’s personal wealth isn’t a matter of public record, it is known that Belfort personally received $940,500 from Red Granite Pictures for the screen rights to his book alone. Between these, his ongoing work for Keppler Speakers, and the publishing of his two memoirs, Belfort seems to be living proof that not only can crime pay, if it’s interesting enough it can pay twice. This has, of course, further angered Belfort’s critics, who perhaps rightfully feel he has never truly been punished for his misdeeds (Belfort served only 22 months in prison for the theft of approximately $200 million). But to understand the laws surrounding the financial opportunities that criminal notoriety offers requires a look back to the 1970s and a decidedly different breed of criminal.

David Berkowitz

In the summer of 1977, New Yorkers lived in fear of David Berkowitz, the serial killer popularly known as The Son of Sam. His three-year killing spree claimed the lives of six people and maimed a further seven, garnering massive media coverage. Following his arrest on the 10th of August, police and state officials quickly became aware of a number of publishers offering substantial sums for the rights to Berkowitz’s story. Keen to prevent a man from profiting from crimes that destroyed so many lives, the state of New York quickly passed a set of laws designed to seize any profits the perpetrator could gain from the notoriety of their crimes and redistribute them to the victims and their families. These measures, which became known as “Son of Sam Laws,” were quickly adopted by a number of other states and were used against many high-profile convicts such as ‘Unicorn Killer” Ira Einhorn and John Lennon’s assassin Mark Chapman. Beyond the profiteering of the criminals themselves, these laws also attempted to suppress the sale of “Murderabilia,” collectibles associated with famous criminals and serial killers.

However, as the years passed, these laws came under increased scrutiny from civil liberties watchdogs claiming the measures violated the First Amendment rights of the defendants. In a 1987 lawsuit that reached the Supreme Court, a ruling of 8-0 declared the laws unconstitutional on the grounds that they financially disincentivized free speech and constituted an unnecessary method for the sourcing of restitution. They also found the laws to be overly inclusive in their construction, to the point that they could be used against anyone who admitted to a crime in a creative work, regardless of charge, prosecution, or conviction. In an amusing connection to Scorsese, this lawsuit was filed by Simon & Schuster, the publisher of Henry Hill’s memoir Wiseguy that was later adapted into Goodfellas. Combined with other lawsuits in states such as California and Texas, most Son of Sam Laws had been overturned by the early 21st century. Ironically the laws were never used against Berkowitz himself, who was ruled incompetent by reason of insanity and therefore not subject to the law in its original wording.

In the years since, the US government has pursued more direct means in order to draw financial restitution. In the case of Belfort, while he is free to profit from the renewed fame his crimes have given him, his income has been garnished by 50% until his full reparations have been paid. In July 2003, presiding Judge John Gleeson set this amount at $110,362,993.87. As of October 2013, Belfort has repaid $11,629,143.64. However, in recent months and in the wake of the financial gains that Scorsese’s film has brought to both Belfort and Red Granite, questions have been raised over his commitment to repayment.

Belfort’s lawyer Nicholas De Feis has publicly stated his commitment to his reparations and guaranteed that “he has never run from his obligations.” Furthermore, Belfort himself has stated in interviews and on his Facebook page that he has not personally profited from his films or books, a statement that US Attorney Robert Nardoza says is simply “not factual.” According to documents provided by the US Department of Justice, in the year he received almost $1 million for the rights to his memoir, Belfort made restitution payments totaling just $21,000. This is in a year when Belfort was also making considerable personal gains from his work with Keppler Speakers and his new company Motivation Global. There are also concerns among prosecutors that he has used this new Australian-based firm to hide assets outside the reach of the US government.

On the October 11, 2013, US Attorney Loretta E. Lynch filed for Belfort to be found in default of his payment, a charge that could result in further fines and even additional jail time. However, 14 days later, Lynch’s office withdrew the petition on the basis of a new deal with Belfort’s Lawyers that has not yet been made public. Then in a memorandum released earlier in June of this year Judge Gleeson commented that the previously ordered garnishing of Mr. Belfort’s income has been suspended in response to the completion of his three-year supervised release. While Gleeson states that Belfort “remains subject to a broad array of means by which the Department of Justice may collect the restitution due and owing,” prosecutors have declined to comment on any future actions that may be taken by the DOJ. Again it seems that world-class crime results in a world-class level of treatment, even from your prosecutors. Most would find their bank unsympathetic to a default of $10,000. But when there’s over $100 Million at stake, there’s clearly far more wiggle room available.

The struggle between the Department of Justice and Belfort’s lawyers will likely continue long after debate surrounding the film has ebbed away. But at a time when financial criminals are appearing harder and harder to effectively prosecute, Belfort’s apparent dodging of his responsibilities will do little to help the public’s confidence in the US legal system. If a convicted criminal can still outmaneuver the most powerful government in the world, what hope is there to contain the kind of activity that can truly damage the world’s economy?