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LA Times: Wall St. on Edge Over Probe of IPO Practices

Apr 22, 2001, 15:00 (0 Talkback[s])
(Other stories by Debora Vrana, Joseph Menn)

"Two senior officers in Credit Suisse First Boston's Silicon Valley office have been placed on administrative leave, sources said, deepening concerns on Wall Street over a federal probe into sales practices involving initial public offerings."

"The two men, John Schmidt and Michael Grunwald, were brokers who worked with tech executives and other clients of Frank Quattrone, the powerful CSFB lead investment banker for technology. 'If there is guilt here, it's going to blow up a lot of people,' said one Wall Street insider."

"The federal probe is looking into business arrangements on Wall Street related to stock IPOs of recent years--specifically, whether some investors who were allocated shares in hot IPO deals also paid large commissions to the underwriting firms on other transactions...."

"Dozens of Silicon Valley firms used the investment bank, including AvantGo Inc., OmniSky Corp., Evolve Software Inc., Handspring Inc., Iprint Inc., Onvia.com Inc. and VA Linux Systems Inc."

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