Credit Suisse First Boston broke ranks with Frank Quattrone Monday, saying it had begun its own investigation of the powerful investment banker and would place him on administrative leave pending its completion.
Quattrone already faces charges from securities regulators for allegedly directing CSFB research analysts to tailor their ratings to help attract banking business, as well as for allegedly doling out hot IPO shares to favorite clients.
It was also reported last week that regulators are reviewing a December 2000 email sent by CSFB investment bankers telling employees to purge certain emails as the firm braced for investor lawsuits over fallen IPO shares. Shortly after it was sent, reports emerged that some of the bank’s IPO practices had drawn the interest of securities regulators.
In a release Monday, CSFB said Quattrone was placed on leave after the company uncovered information that “raised questions about Mr. Quattrone’s response to an inquiry last week by the firm about whether he was aware of pending investigations in 2000 when he sent an email to employees regarding document retention issues.” The bank said new information “raised questions about whether Mr. Quattrone acted appropriately in December 2000 when he sent that email and permitted a subordinate to send a similar email to employees.”
The NASD recently notified Quattrone that he might face civil charges stemming from his dual role as CSFB’s lead technology investment banker and the supervisor of some of the firm’s tech analysts.
Last week, when news of the NASD charges were first reported, CSFB appeared ready to stand behind Quattrone. A statement released by the firm gave no indication that Quattrone would be put on administrative leave.
In its release, CSFB implied that no documents were destroyed. The firm said, “it acted promptly to ensure that all relevant documents would be preserved and provided to authorities.”
Quattrone could not be reached for comment. Last week he issued a statement in which he said he was cooperating with regulators and was “confident that the truth will prevail.”