Quattrone Out At CSFB
Global Technology Chief Parts Ways With Credit Suisse After Coming Under FireMar 4, 2003 | CNN/Money
Frank Quattrone, who brought regulatory scrutiny to Credit Suisse First Boston's investment banking practices, said he resigned Tuesday to concentrate on defending himself against allegations of document destruction.
Quattrone, the head of the firm's California-based global technology group, was at the center of wide-ranging probes into the way investment banks did business and brought companies public in the late 1990s.
His departure reflects the legal pressure surrounding him and New York-based CSFB, which became one of Wall Street's hottest stock underwriters under Quattrone.
CSFB said the firm and Quattrone, 47, agreed that it was in their respective best interests for him to leave. A statement on behalf of Quattrone said he left voluntarily.
Investigators want to know whether Quattrone recommended the destruction of e-mails concerning companies he helped bring public during the technology boom.
"The separation and independence also enable Mr. Quattrone to concentrate his full energies on his defense," the statement on behalf of Quattrone said. "Once again, Mr. Quattrone is innocent. At the time he sent his e-mail in December 2000, he was following the document retention policies in force for his technology banking group at CSFB. He did not destroy any documents nor improperly direct others to do so."
Quattrone's departure appeared imminent after news surfaced that he declined to testify before securities regulators last week
Credit Suisse First Boston,a unit of Switzerland's Credit Suisse Group, was among 12 financial organizations that agreed to pay a total of more than $1.4 billion to end a probe into allegations of tainted stock research. Regulators say the firms misled investors by publishing overly optimistic research designed to lure investment banking deals.
CSFB paid $150 million in the settlement whose final language is still being drawn up. That was second only to Salomon Smith Barney's payment of $400 million.
Quattrone is only the latest high-profile analyst to leave the business. Jack Grubman resigned from Salomon Smith Barney last year amid criticism that conflicts of interest led him to publish misleading stock research.
Quattrone was suspended by the firm last month for questionable conduct related to an earlier investigation of initial public stock offerings.
The Wall Street Journal reported last week that in a series of e-mails on Dec. 3, 2000, CSFB's in-house lawyer David Brodsky informed Quattrone about the investigations into the underwriting of technology stocks.
The e-mails were sent two days before Quattrone, in a Dec. 5 e-mail, urged CSFB bankers to follow the advice of a CSFB banker to dispose of notes, valuation analyses and other internal memos to protect the firm against lawsuits resulting from the bursting of the technology-stock bubble, the paper said.
"We expect Mr. Quattrone to be exonerated when all the evidence is in," Quattrone spokesman Bob Chlopak said in a statement.