Credit Suisse First Boston is a firm that has enjoyed the dubious honor of gracing the pages of our newsletter and has been the topic of conversation on our radio show on many occasions. Nothing like an encore!
In an effort to dig up additional business, CSFB told a prospective client it would conduct more lenient research than its competitors. This is according to documents being gathered to support a possible criminal case against the firm.
Recently uncovered documents by Massachusetts securities regulators show that CSFB resumed positive coverage of a technology company after it had paid investment-banking fees. In an email from March 2001, Frank Quattrone, (another frequent flyer here) a big-shot investment banker was told by a colleague that Research In Motion Ltd. should return to “most favored nation status” now that the company “paid us the extra $1.8 million we asked for.”
The documents also contain a July 1999 CSFB sales presentation indicating that the company was more forgiving than competitors in the research ratings it assigned to its clients stocks.
This story should be front-page news. The complete disregard for the individual investor and evident conflict of interest calls for jail time. Not just Frank Quattrone, but the executives that allowed this disgrace to occur. A class action suit has been filed against CSFB in the State of Massachusetts. If you want further information give us a call as soon as possible.