Mr. Quattrone will enter into a deferred-prosecution agreement that will impose no penalty if he does not violate any laws in the next several years, these people said.
They spoke on the condition of anonymity because the judge has not yet formally approved the settlement. While deferred-prosecution agreements often include an admission of wrongdoing, there is no such statement by Mr. Quattrone in the settlement, they said.
For federal prosecutors who had once sought to portray Mr. Quattrone as a symbol of Wall Street greed and manipulation during the dot-com bubble, the settlement is a significant retreat. The case against Mr. Quattrone had been the most prominent prosecution of a Wall Street figure since Michael R. Milken, who pleaded guilty to six securities charges in 1990.
Now, speculation has been rampant in Silicon Valley that Mr. Quattrone will start a boutique advisory and private equity firm focused on technology companies. He may even try to reassemble some of his former team of bankers from his old firm, Credit Suisse First Boston.
The agreement is expected to be presented for approval before Judge George B. Daniels of Federal District Court in Manhattan at a hearing on Tuesday.