Banker Quattrone Avoids Third Trial
RENEE MONTAGNE, host:
Our business news starts with an investment banker who wants to avoid prison.
A judge in New York today could decide the fate of star investment bank Frank Quattrone. He was once one of Silicon Valley's most powerful bankers, helping take companies such as Amazon and Netscape public, and pocketing millions of dollars in the process.
Quattrone was convicted last year of obstruction and witness tampering, but his conviction was overturned by an appeals court. Now his lawyers have reached an agreement with prosecutors that will allow him to avoid another trial.
This morning Judge George Daniels will decide whether to accept the deal. NPR's Jim Zarroli joins me now. Good morning.
JIM ZARROLI reporting:
MONTAGNE: Remind us again, more detail, of what Frank Quattrone was accused of, and how did his conviction come to be overturned?
ZARROLI: Well, in December 2000, the federal government was investigating the way that his employer, Credit Suisse First Boston, allocated stock options during initial public offerings. Prosecutors said that at one point, Quattrone tried to thwart the investigation by telling his staff in an e-mail to comply with the company's policies about document retention. Now prosecutors said that Quattrone was simply trying to send a sort of coded message to people to destroy incriminating evidence. Quattrone always denied that.
His first trial ended in a hung jury. He was then tried a second time and convicted, but the appeals court overturned the verdict. The court said that the judge, the trial judge, had instructed the jury improperly.
MONTAGNE: And he is scheduled to appear in court again this morning, and what is expected to happen?
ZARROLI: Well, the judge is going to decide whether Quattrone will have to stand trial for a third time. Quattrone and the prosecutors have come up with what's called a deferred prosecution agreement. According to a source who's familiar with the details, that means that he won't have to stand trial again, as long as he doesn't commit any more crimes over a specified length of time.
He won't have to admit any wrongdoing. The deal would also give Quattrone a pretty significant victory in another way. He'll be able to resume his career in finance. Originally prosecutors had wanted to ban him for life for ever working in the securities industry again.
MONTAGNE: Now, if the government believes Quattrone committed securities fraud, why are prosecutors deciding not to just try him again?
ZARROLI: It's not clear. Because when the judge overturned the verdict after the second trial, he said that if the trial judge hadn't committed the error there was a good chance that Quattrone probably would have gone, would have been convicted anyway. So a lot of legal analysts were saying that, were expecting the government to go for a third trial.
This is just a significant concession on the part of prosecutors. The case has dragged on a long time. Quattrone wouldn't plea bargain. He dug in his heels and now six years have gone by. A lot of time and money was spent on the case. Also, the man who prosecuted Quattrone, David Anders, isn't with the Justice Department any longer. So it certainly seems as if the government has just decided to, you know, cut its losses and move on.
MONTAGNE: NPR's Jim Zarroli in New York. Thank you.
ZARROLI: You're welcome. Transcript provided by NPR, Copyright NPR.