NEW YORK — Frank Quattrone is expected to face a fierce cross-examination today as prosecutors try to save their obstruction-of-justice case against the former star Credit Suisse First Bostonbanker.
The momentum in the most-watched Wall Street criminal trial in a generation appeared to shift to the defense Thursday as Quattrone delivered a poised and polished performance in the biggest sales job of his career.
Before a standing-room-only crowd of ”friends of Frank,” curious onlookers and the media in federal court in Lower Manhattan, Quattrone addressed the six-man, six-woman jury for more than three hours, repeatedly denying that he intended to destroy evidence when he forwarded a December 2000 e-mail urging employees ”to clean up those files.” The e-mail is at the core of the government’s case that Quattrone tried to derail a federal grand jury investigation into whether CSFB took kickbacks for giving hedge funds hot stock offerings.
While acknowledging that CSFB lawyers told him the bank’s allocation of initial public offerings was under government scrutiny, the 47-year-old multimillionaire, his bushy mustache trimmed for the occasion, testified that he felt neither ”threatened” nor ”frightened” by the news.
”This was about IPO allocation. It was a different division of the bank,” Quattrone said.
The outcome of the trial, in which closing arguments are expected Tuesday, is expected to revive a debate over the use of obstruction charges against corporate executives such as Martha Stewart. Legal experts say it is rare for white-collar defendants to take the stand and risk a grilling in cross-examination. But Quattrone has a reputation as a forceful and articulate advocate.
”If you are scoring it right now, you have to say advantage, defense,” says George Newhouse Jr., a partner at Thelen Reid & Priest and a former federal prosecutor. ”But the prosecution has a few serves left.”
By announcing at the start of the trial last week that Quattrone would testify, defense attorney John Keker ran the risk of inviting the prosecution to hold back dramatic evidence for cross-examination. But the defense hopes the gambit will sway an unusually well-educated jury of nine university graduates and two Ph.Ds.
As he testified about the ”cleanup” e-mail, Quattrone said he was upset by an original draft by a subordinate that closed: ”Today, it’s administrative housekeeping. In January, it could be improper destruction of evidence.”
Quattrone said that bothered him because e-mail ”lasts forever and can come back to bite you.” He added, to laughter, ”I guess I was right.”
