Boiler Room 2026
Cold calls. Sales scripts. Promises of 1,000% returns. The SEC says an old stock-peddling scam found a new generation of victims.
“The name of the game, moving the money from the client's pocket to your pocket.” – A line from “The Wolf of Wall Street.”
Meyer Blinder built a nationwide penny-stock operation around cold-calling hucksters who pushed stocks until the supply of new suckers ran out.
Robert Brennan built First Jersey into a sprawling brokerage with hundreds of thousands of accounts, many belonging to seniors pressured into dubious stocks over the phone.
Jordan Belfort, who was immortalized by Leonardo DiCaprio in “The Wolf of Wall Street,” used high-pressure salesmen to foist questionable stocks on investors.
One goal of Business Blunders is to familiarize readers with the same frauds that keep happening over and over because too many investors never learn from the past. But I thought the stock-pushing boiler room business went out with landlines and fax machines.
Nope.
Just last week, the Securities and Exchange Commission filed a lawsuit against a Long Island, N.Y., man who the regulator says dusted off the same old playbook.
The SEC’s civil complaint charges Andrew Spaventa, 40, and three entities he owned with fraud.
Spaventa told Fortune he denies the allegations and that he plans to defend himself. His companies – The Spaventa Group, TSG Capital Advisors and TSG Alpa Partners. – were also charged with fraud.
We’re talking the whole freakin’ cliché from the 1980s and 1990s, according to the complaint. More than 100 sales agents. Cold calls. Sales scripts. Preposterous claims of 1,000% returns. Hidden compensation. And lots and lots of lies.
The SEC says the operation ran from 2020 through 2025 and raised $74 million from more than 800 investors, including 100 seniors who made the mistake of answering the phone.
A boiler room charged in 2026? Who even answers the phone these days?
“Unsolicited calls and high-pressure sales tactics are the calling cards of so-called boiler room operators,” Sheldon L. Pollock, Associate Director of the SEC’s New York Regional Office, said in a press release. “They get you on the phone and then hit you with the hidden fees.”
But it was more than hidden fees.
Spaventa and crew hawked funds with exposure to pre-IPO shares from splashy enterprises – including Stripe, Impossible Foods and Space X – and aggressively marked up the prices. In one example listed in the complaint, they sold investments tied to Anthropic shares at a 41% to 79% markup, a deal that netted them nearly $5.8 million in 2024.
The complaint says Spaventa enriched himself by at least $4 million from these fees, which he spent on luxury car payments and home renovations. He also paid his sales squad more than $12 million in commissions.
Many of the agents had zero experience in private investment funds, were not properly registered, or worse: They had been suspended or barred by the Financial Industry Regulatory Authority.
Spaventa himself had been suspended by FINRA in 2019 for failing to comply with an arbitration award or settlement stemming from a customer complaint. The suspension was lifted after he complied.
The boiler room ran off sales scripts and lines like these:
“We’ve never had a losing position.”
“We’ve been getting returns between 200 to 1,000% to our clients with our previous investments like Airbnb, Palantir, SpaceX before they went public. … "
“What separates us from the rest is that we will not rip you off.”
Quick investor tip: When sales agents suddenly volunteer that they are not going to rip you off, they’ve already got their hands in your pockets.
The scheme took in more than 800 investors, including more than 100 retirees. More than 650 invested $100,000 or less, and more than 220 invested $20,000 or less.
“The vast majority have not recouped their investments and some have already incurred total or near-total losses.” the complaint said.
“The Wolf of Wall Street” debuted in 2013. Apparently, some people mistook it for a training video.
For all the changes in technology since Jordan Belfort was indicted in 1998, the boiler-room script hasn't changed much: Pick up the phone and start dialing.
