The movie “The Wolf of Wall Street” was very controversial from the start and that may have been the reason it failed to win an Oscar. Leonardo DiCaprio’s portrayal of a “boiler room” stock fraudster and his brazen, over-the-top sex and drug-crazed criminality would have made Al Capone blush. Making matters worse, director Martin Scorcese’s “dark comedy” of appalling greed, wanton recklessness and total indifference to stealing is based on a true story.
That is no surprise to the millions who have been ripped off by stock fraudsters or who are victims of Wall Street’s irresponsible and criminal conduct, which, after the financial crash of 2008, is just about all Americans who will have to pay the trillion dollar tab.
There has been a lively debate about the fact, near fact and not so factual parts of the movie. There’s no question that in real life, Leo’s character, Jordan Belfort, was a crooked, amoral criminal who cavalierly broke the law, ultimately became the target of an FBI investigation and was “punished” with just a few cushy months in a federal prison after getting special treatment for ratting out his fellow criminals.
But, to the extent that the movie implies that this relatively small time hustler was Wall Street’s biggest, worst, most notorious or even a representative wolf of Wall Street, Leonardo DiCaprio and Martin Scorcese are howling up the wrong tree. Frankly, the movie simply misses the real story about the real wolfs that roam Wall Street and inflict damages far beyond the imagination of Leo’s character. That’s the story that really matters.
As singer, songwriter Don Henley so insightfully understood, “a man with a briefcase can steal more money that any man with a gun” or, in Belfort’s case, a mere phone. For example, while Belfort stole somewhere around $200 million, Wall Street paid itself record-shattering bonuses of almost $50 billion for just one year, 2007, which was the year before the Wall Street greed-fest crashed the financial system, resulted in massive taxpayer-funded bailouts, threw tens of millions of Americans out of work and millions more out of their homes, and almost caused a second Great Depression. (As brilliantly revealed in Charles Ferguson’s must-see 2010 Oscar winning documentary film Inside Job.)
What happened to those on Wall Street who caused or contributed to this historic financial and economic wreckage, much of which is still hurting so many American families today? Virtually nothing. Oh, sure, there have been a few settlements, but not a single individual Wall Street banker has been held accountable and even the settlements look like nothing more than sweetheart deals.
For example, the largest US bank, JPMorgan Chase, run by the high profile, well-connected CEO Jamie Dimon, recently settled with the Justice Department for years of massive, knowing illegal conduct that contributed to the 2008 crash. Remarkably, JP Morgan Chase wasn’t required to disclose any meaningful information about its crimes or admit any wrongdoing whatsoever, but got complete civil immunity for a payment of $13 billion, which seems like a lot of money, except it is not on Wall Street and not for a bank with trillions of dollars in assets. It is really little more than a minor traffic ticket for a too-big-to-fail bank like JP Morgan Chase.
Actually, the traffic ticket analogy is misleading because it overstates the severity of the “penalty.” No one who gets a traffic ticket gets to use it as a tax deduction. JPMorgan Chase, on the other hand, will likely save about $4 billion in tax liability by deducting the settlement amounts from its taxable income. That would make Leo’s Wolf green with envy: massive crimes, getting caught, keeping all the bonuses, no individuals punished, paying a settlement years later with other people’s money (JP Morgan Chase’s shareholders) and then using it as a tax deduction. (It’s enough to make Sen. Elizabeth Warren fight against such tax deduction.)
The movie might also give the false impression that financial crimes are prosecuted and that people go to prison, even though Jordan Belfort ultimately got off pretty easy. The getting off pretty easy part is certainly accurate, but at least the FBI doggedly investigated him and actually put him in prison for 22 months.
In contrast, the many bankers who caused the greatest financial crisis since 1929 and the worst economy since the Great Depression of the 1930s – the real Wolves of Wall Street – have never faced prosecution or accountability of any type, and almost certainly never will. While the Justice Department still claims it might prosecute someone for their crimes, the wolfs on Wall Street are laughing all the way to the bank knowing that the statute of limitations on almost all crimes have already expired or will soon enough.
Making matters worse, not only are the wolves still at large, but they are steadily chewing up every attempt to regulate or bring them under control. They have waged a fierce campaign to defund, delay, or derail financial reform rules that are meant to prevent them from crashing the US financial system and economy again. The only way to protect our economy from being eaten by the real wolves is by demanding accountability, transparency and oversight of both Wall Street and its Washington allies.
That is why Better Markets recently sued the Department of Justice to stop the $13 billion backroom settlement deal it cut with JP Morgan Chase. As stated in the lawsuit, the American people deserve better. They deserve to know what JP Morgan Chase did and whether or not government officials are doing their jobs to bring the wolfs of Wall Street to heal.