CSFB fires 3 in IPO probe

CSFB fires 3 in IPO probe

Three brokers in San Francisco office had been on administrative leave

New York, June 28, 2001: 5:42 p.m. ET (CNNfn) - Credit Suisse First Boston confirmed Thursday that it has fired three brokers in its San Francisco office as the result of a probe into its allocation of initial public offerings.

CSFB terminated brokers Michael Grunwald and John Schmidt, both managing directors of the private client services group in San Francisco. Scott Bushley, a vice president in the group, also was let go, CSFB spokeswoman Jeanmarie McFadden said.

The three employees had been on administrative leave. "They violated the firm's procedures and policies," McFadden said.

CSFB's actions against the three employees are a result of its own internal investigation, a source said. The banking unit of Credit Suisse informed the appropriate regulators of its actions, the company said in a statement.

CSFB currently is the subject of a federal investigation that alleges the bank requires big investors to pony up large commissions in exchange for access to IPOs.

In May, CSFB reportedly told two senior employees that they violated firm principles and practices in doling out IPO shares to clients. At least six CSFB employees have been notified by the regulatory arm of the National Association of Securities Dealers that they are under investigation due to the probe.

But the three employees fired Thursday are not part of the six notified by NASD, the source said.