Trial Of Former CSFB Star Banker Begins

by Glen Shapiro, LawAndTax-News.com, New York

02 October 2003

The trial of former CSFB star technology banker, Frank Quattrone began in New York this week with the allegation that when he forwarded an e-mail urging CSFB staff to destroy documentation relating to the allocation of 'hot stock offerings', he was solely concerned with protecting "his business, his reputation and his livelihood".

Speaking to the 12 person jury in the Manhattan federal courtroom on Tuesday, Assistant US Attorney, Steven R Peikin suggested that when the former CSFB executive received an e-mail from his subordinate, Richard Char, urging other employees to undertake 'administrative housekeeping' in view of potential litigation over stock allocations in initial public offerings (IPOs), "he had a choice".

"But Frank Quattrone chose another path, a path that violated the law and a path that would lead up the steps of this courthouse and into this courtroom," he announced.

However, defense attorney, John Keker argued that there had been no criminal intent in Mr Quattrone's decision to forward the e-mail with an endorsement, explaining that the banker was merely following the company's document retention policy, and that in any case, he could not have known that the subpoenas which had been issued by a Southern District of New York federal grand jury applied to his department.

Investigations into suspect IPOs were also being undertaken at that time by the National Association of Securities Dealers (NASD), and the Securities and Exchange Commission (SEC).

"You are going to see a lot of information about subpoenas," Mr Keker told the jury, continuing: "The (CSFB) lawyers never suspended the (retention) policy."

He went on to add that the financial services firm's legal department also never told Mr Quattrone that the subpoenas related to more than a request for information from the Equity department, which actually handled the disputed IPO allocations.

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