It would have made Houdini proud. It took three-and-a-half years, but Frank Quattrone has extricated himself from both regulatory shackles and a criminal conviction that once seemed likely to end to his brilliant if controversial career in disgrace.

It would have made Houdini proud. It took three-and-a-half years, but Frank Quattrone has extricated himself from both regulatory shackles and a criminal conviction that once seemed likely to end to his brilliant if controversial career in disgrace. 2

The odds were against him. “Something on the order of 94 percent of those charged in federal court either plead or are found guilty of something,” said Lee Altschuler, former chief of the U.S. Attorney’s Office in San Jose and now a Palo Alto defense attorney. “It’s not always a function of the strength of the evidence. It’s also the resources to fight back in court.”

Quattrone had the money for a high-caliber defense and the will to refuse a plea bargain. In reversing his own reversal of fortune, the former chief of technology banking for Credit Suisse First Boston succeeded where such high-profile, deep-pocket defendants as Michael Milken, Charles Keating and Martha Stewart failed. They went to prison. Quattrone, steadfastly maintaining his innocence, won his appeals and ultimately made prosecutors back off.

In the ultimate analysis, legal observers say, Quattrone may have prevailed because the case against him was questionable from the start, and because regulators and prosecutors took an unreasonably hard-line approach in their quest to punish him.

Attorney Ken Hausman, who helped defend Quattrone against charges brought by securities regulators, said authorities repeatedly and unfairly sought to apply new rules retroactively to Credit Suisse’s actions, and unfairly focused on Quattrone as well.

In 2002, the SEC, the self-regulating National Association of Securities Dealers and the New York Stock Exchange opened a joint investigation of conflicts of interest on Wall Street. Quattrone became the focus of allegations that Credit Suisse was violating rules prohibiting gifts and gratuities by dispensing stock to favored clients in start-up companies prior to the initial public offering. During the dot-com boom, this allowed clients to “spin” the typically fast-rising stock for a quick windfall.

Scroll to Top