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Boiler Rooms – In the Movies and In Real Life

September 23, 2019

[Photo:  Boiler Room / NewLine Cinema]


by Howard Haykin



If you saw the movies, “Boiler Room” (2000) and “The Wolf of Wall Street” (2013), you viewed first-hand how high pressure brokers can line their pockets at the expense of innocent investors by scamming them into buying worthless or wildly-overpriced securities. ‘Boiler rooms’ are, after all, large-scale operations designed to lure as many investors as possible into an investment scam - often using high-pressure sales tactics through cold calls, emails, text messages, social media and other means.   



WELCOME TO REALITY.    The U.S. Securities and Exchange Commission the "SEC") charged Benjamin Conde, 56, a resident of Fairfield, NJ, with orchestrating a New York-based boiler-room operation that bilked individual investors out of millions. He did so by unloading shares of small, lightly-traded penny stock at inflated prices – thanks to help from traders and salespersons at so-called boiler rooms.


According to the SEC, Benjamin Conde first acquired (on the cheap) large blocks of shares in Renewable Energy and Power Inc. (“RBNW”) - a company that was 'going nowhere fast'. He then retained a New York boiler room to artificially ‘pump up’ (promote) the market price and the trading volume of those shares. Over the next 5 months, a large-scale promotional campaign touted RBNW while boiler room salespersons targeted retail investors – specifically, the elderly and unsophisticated – and aggressively solicited them to purchase RBNW stock.


Having established the false appearance that RBNW was an actively traded stock with a rising price, Conde unloaded his shares at artificially high prices on unsuspecting retail investors. All told, Conde earned $3.1 million in illicit profits, while investors lost more than $2.4 million.





  • Aggressive Sales Tactics or Threats.  Fraudsters may use aggressive sales tactics or even threats to swindle you - e.g., threatening to file a lien against your property.
  • Pressure to Buy Quickly.  No reputable investment professional should push you to make an immediate decision about an investment.
  • Unsolicited Offers.  Be wary of any investment offer you didn't ask for, especially if you don't know the sender.
  • Promises of High Returns with Little or No Risk.   Every investment carries some degree of risk, and the potential for greater returns usually comes with greater risk.  If it sounds too good to be true, it is.


Armed with this knowledge ... you're now capable of resisting pressure from a boiler room. And when it comes to any form of investment, always take your time to investigate thoroughly before committing money or signing any agreements.