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BOILER ROOM TERMS

BOILER ROOM TERMS. Series 7 = Broker License Wood = A weak sale A Whale = Big Rich Guy A Rip = A Broker’s Commission IPO = Initial Public Offering for stock. Seth – Casino Greedy? Wants to impress dad. 1. What is going on? Sumthin’ ain’t right. Boiler Room Questions.

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BOILER ROOM TERMS

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  1. BOILER ROOM TERMS Series 7 = Broker License Wood = A weak sale A Whale = Big Rich Guy A Rip = A Broker’s Commission IPO = Initial Public Offering for stock

  2. Seth – Casino Greedy? Wants to impress dad

  3. 1. What is going on? Sumthin’ ain’t right. Boiler Room Questions

  4. Michael – Owner of JT Marlin How can he afford to pay such huge RIPS?

  5. Job Interview:Unprofessional?

  6. Are Seth’s co-workers ethical?

  7. The SEC forbids a broker from recommending stock that would personally benefit him/her or his/her company. Why do you think that this is illegal?

  8. STEP ONE • The owner of JT Marlin creates a company, on paper with his friends. • They file all the required SEC documents. • They even rent a building for an actual address.

  9. Step Two • The brokers convince people that the fake company is a great investment. • They create a buzz: “This company is about to release a new drug…” • The IPO stock will start at less than a dollar, • BUT as soon as people start buying, it will drive the price up to $10 even $20.

  10. Step Three • The huge RIPs encourage all brokers to push the stock, which creates higher and higher prices (increase demand). • The early investors, which are mostly the fake owners, cash out their stock when it reaches $10 a share. • Early investors get VERY rich.

  11. Step Four • Eventually, since there is no actual company, the stock will be seen as weak and will drop back down to zero (no buyers). • Late investors will lose everything.

  12. Step Five • If the SEC catches on, you shut down the company and leave no traces. • The SEC may not chase or investigate a company that no longer exists. • Open a new “Boiler Room” in another location and start the process over.

  13. Will raid the building Get info for FBI to save dad Med Patent IPO = BIG BUCKS Must get Harry’s IPO sale signed off on by a senior broker so he can cash out on huge profits Lie to Michael and say Harry’s a whale to get Harry the MED PATENT IPO Doesn’t trust Seth and wouldn’t sign off on an IPO sale

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