Frank Quattrone, the one-time superstar on Wall Street with an oracle eye for hot new hi-tech companies and bringing them to the market, was convicted of obstructing a federal investigation into financial wrong-doing at his bank, Credit Suisse First Boston, yesterday and could face a year in prison.
The guilty verdict came at the end of the second trial of Quattrone. While his first trial last autumn ended in a hung jury, this time jurors returned their verdict after deliberating for just seven hours over two days. As the decision was read out in the Manhattan court, friends and family of the banker openly cried.
Mr Quattrone, 48, was convicted on all three counts against him: obstructing a grand jury, obstructing federal regulators and witness tampering. At the heart of his case was the prosecution's contention that he sent out a 22-word e-mail to colleagues suggesting they destroy files.
At the time of the incident, a grand jury and federal investigators were looking into how the bank distributed stocks of new hi-tech companies going public. No charges were ever brought in the investigation, but CFSB eventually agreed to a $100 million civil settlement with the government.
In pleading innocent to the charges, Mr Quattrone said he was simply following bank policy when he dispatched the e-mail two days after hearing of the government inquiry in December 2000. The former star banker will be sentenced in September. His lawyers last night said they would appeal the verdict.
For the government, the guilty verdict will reinforce its efforts to clamp down on malfeasance in the corporate and financial worlds. Many observers had predicted the second trial would be an uphill battle for the government.
This year, federal prosecutors secured the conviction of Martha Stewart, the domesticity guru. Less successfully, the high-profile case involving the former Tyco chief executive, Dennis Kozlowski, ended in a mistrial.
Now a convicted criminal, Quattrone will always have a place in Wall Street lore. He has long been considered the most important figure in harnessing Silicon Valley to the Street at the onset of the Nineties hi-tech boom, working successively for Deutsche Bank, Morgan Stanley and finally for CFSB. His forte was bringing new, fast-growing tech companies to the market to become public.