Wolf of Wall Street brokers have not been banned from trading despite warnings

Stratton Oakmont traders are still working on Wall Street

A US watchdog has not barred any of the real-life traders that inspired 'The Wolf Of Wall Street'.

(Mary Cybulski/AP)

The Stratton Oakmont traders whose unorthodox practises inspired the film The Wolf Of Wall Street are still trading despite numerous warnings by watchdogs.

Stratton Oakmont is now infamous for stories about dwarf-throwing and cocaine-binging, glamourised by Scorsese in the film. In real life its professional services did normal people out of millions of dollars.

But Finra High Risk Broker, a programme that is supposed to target brokers associated with risky firms or those who have received disciplinary red flags, have not barred any of the traders involved, according to the Wall Street Journal, even though some have been warned about their practices multiple times.

The Journal reports that Christopher Veale, who started his career as a stockbroker with Stratton Oakmont, has worked for 18 firms and received 25 red flags on his disciplinary record in the last 20 years.

Veale’s disciplinary record shows 10 customer complaints, payouts of more than $327,000 (£21,4660), regulatory actions and six expelled firms. He was branded “unethical and unscrupulous” by a regulator last year for the way that he treated an 81-year-old investors.

Veale told the Journal he had moved on to other ventures and declined further comment after it asked Finra for comment on his record.

Finra has expelled 131 brokers from trading. Stratton Oakmont was closed by regulators 18 months ago, but not before it cost investors more than $200 million.

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The Journal analysed hundreds of thousands of brokers records and found that 166 of Stratton Oakmont’s 904 brokers were still working in stock broking last year. On average, Stratton brokers have received nine times as many red flags as the average broker, according to the Journal’s analysis.

Susan Axelrod, Finra’s head of regulatory operations, told the Journal that just because someone has worked for a high-risk or expelled firm “doesn’t mean they’re necessarily guilty of anything”.

Meanwhile Jonah Hill, who played a Stratton Oakmont executive called Danny Porush in Scorsese’s version, disputed some of the more outlandish scenes in the film. “We never abused [or threw] the midgets in the office; we were friendly to them,” he told Mother Jones.