NEW YORK - Credit Suisse First Boston said yesterday that Frank Quattrone, whose Silicon Valley office managed the most computer-related share sales at the height of the Internet boom, has resigned as he faces government probes of allegations he destroyed documents to obstruct an investigation.
Quattrone was suspended last month after the unit of Switzerland's second-largest bank discovered evidence he knew the firm was under investigation when he told his staff to "clean up" its files. Quattrone has been under investigation by federal and state prosecutors in New York.
His departure "is probably the last bit of air being let out of the tech bubble," said Michael Madden, principal with private equity firm Questor Management Co. and a former investment banker with PaineWebber Inc., Kidder Peabody and Lehman Brothers. "Maybe now we can move on."
Securities lawyers said the firm may still face liability. Credit Suisse First Boston joined in a $1.4 billion settlement of conflict-of-interest claims between Wall Street firms and state and federal regulators in December. The settlement didn't protect individual bankers and analysts from separate charges. CSFB agreed to a $200 million fine, the second-highest amount paid by any firm.
Quattrone's actions may "bind and taint the actions of the firm as a whole," said Tom Curran, a lawyer at Edwards & Angel who spent six years investigating white-collar crime at the Manhattan district attorney's office. "They have to disassociate themselves from him."
Quattrone joined Credit Suisse First Boston from Deutsche Bank AG in 1998, negotiating an agreement in which he kept half of his division's revenue - after certain costs - to mete out to his staff. Before Deutsche Bank, Quattrone spent 17 years at Morgan Stanley, where he rose to head of the global technology banking.
The 47-year-old banker, who led CSFB's technology underwriting business from an office in Palo Alto, Calif., helped usher in the Internet boom by taking public companies such as Netscape Communications Inc., now part of AOL Time Warner Inc. His unit generated about 12 percent to 15 percent of CSFB's revenue in those years and made him a multimillionaire.
While his group handled almost one initial public offering per week in 2000, his last IPO came in May 2002. From its peak three years ago this week, the Nasdaq composite index has plummeted almost 75 percent. In that time, shares of Credit Suisse Group, the firm's parent, have dropped 64 percent. Its bigger rival, UBS AG, declined about 15 percent.
Credit Suisse First Boston said in a statement that Quattrone and the firm "agreed it was in their respective best interests" for him to quit. His top aides, Bill Brady and George Boutros, remained with the company.
A spokesman for Quattrone, Bob Chlopak, said the resignation will enable him to "concentrate his full energies on his defense." Credit Suisse will hold onto money owed to Quattrone until "the inquiries are resolved," said Chlopak.
Michael Kulstad, spokesman for James Comey, U.S. attorney in Manhattan, declined to comment on Quattrone's resignation. Darren Dopp, spokesman for New York state Attorney General Eliot Spitzer, did not have an immediate comment.