Al D’Amato and friend
Sounds about right, based on my own interviews and depositions of this type of scum.
The founder of Stratton Oakmont, Jordan Belfort , has written a horrible book which has been made into what I hope will be an entertaining movie, “The Wolf of Wall Street”, but no one seems to be focusing on or even remembering who kept this massive fraud going on for years: Republican senator Alphonse D’Amato.
D’Amato did more than just make instant profits (Hillary Clinton, anyone?), he used his position as minority leader of the Senate Banking Committee to shield the company from an ongoing SEC investigation.
Senator Alfonse M. D’Amato was a customer of Stratton Oakmont for approximately five months, beginning in April 1993. We received differing accounts of how Senator D’Amato became a Stratton customer. David Beall, the Stratton RR on Senator D’Amato’s account, offered one version. …
[Belfort’s partner] Porush gave a different version of Senator D’Amato’s introduction to Stratton. Porush stated that Senator D’Amato discussed opening a Stratton account with Jordan Belfort at a D’Amato fundraising event at a hotel in New York City. According to Porush, Senator D’Amato asked Belfort, “Can you make me some money?” Belfort responded, “Are you sure you want to do this? They [the SEC] are looking at me. It would look bad.” According to Porush, Senator D’Amato responded, “Since when is it illegal to make money in the stock market?” [Emphasis added.]
Senator D’Amato’s experience as a Stratton customer is atypical in several ways: First, the Senator was permitted to open an account even though he did not come close to meeting Stratton’s qualification criteria. Second, he was not personally consulted on trading decisions, but was instead permitted to communicate through an assistant. Third, his account appears to have been in effect a discretionary account, which is contrary to Stratton policy. Fourth, he was allocated a much larger number of units of Computer Marketplace — a “hot issue” — than other customers with accounts of comparable size and history at Stratton. New customers with accounts as small as Senator D’Amato’s rarely, if ever, get sizeable allocation of Stratton IPOs.
Stratton’s bending of its own rules to service a United States Senator who, through his status as senior minority member of the Senate Banking Committee, wielded influence over the SEC, raises suspicions about Stratton’s motives. Stratton enabled Senator D’Amato to receive $37,125 from a Stratton hot issue at a time when SEC enforcement proceedings were pending against the firm.
Loewenson’s report raises many questions regarding Senator D’Amato’s conduct regarding the Stratton IPO, and the real facts behind the $37,125 profit he earned that day.
Fourth, did Senator D’Amato intercede on behalf of Stratton Oakmont with the SEC, or otherwise intervene to benefit Stratton Oakmont with any pending legislative or governmental matter? The Ethics Committee must undertake a full, thorough investigation to answer this question.
The Senate whitewashed its colleague, but it is a fact that when D’Amato was defeated (by Chuck Schumer, of all people, in 1998) and left office, the SEC was finally able to shut Oakmont down – and not until then. I have (had) a personal interest in this story because around then I was holding a million-dollar arbitration award against the firm, which it wasn’t paying. The Monday the NASDAQ chief enforcement officer told me that Stratton Oakmont would pay up that day or be suspended, Mary Shapiro, then at NASDAQ, announced that she was shutting down the firm immediately because, as she put it, “we can’t allow them to steal from new victims to pay off the old”. I saw her point, but I was in for third of that million dollars, and the promised payoff was scheduled for 10:00 that morning – Shapiro made her announcement at 9:30. She couldn’t have waited a couple of hours?
In any event, Jordan spent 22 months in prison, was forced to disgorge some of his loot, and is now a “motivational speaker” and the subject of what I hope will not be a hagiographic film, but probably will be. D’Amato, 76, never saw a day in jail, kept all his loot, and lives in Washington, D.C., where he is busy adding to his assets by lobbying his former friends in crime.