Legal News

Prosecutors Suspect Former CS Broker Fled to Native Bulgaria

By Dan Slater

We’ll forgive you if you don’t remember this. But a few weeks ago, we told you about EDNY prosecutors who jumped into the auction-rate securities party by launching a criminal investigation into whether two former Credit Suisse brokers lied to investors about how they placed their money in auction rate securities.

That investigation has acquired a new layer of intrigue as federal prosecutors now suspect that one of the two brokers, Julian Tzolov, a 35 year old Bulgarian native, has fled to his mother country. Here’s the front-page WSJ report from Amir Efrati and Randall Smith.

(For those LB’ers interested in the ARS scandal, we encourage you to read the article. It uncovers how, in e-mails to clients, the brokers allegedly mislabeled the auction-rate securities by using names that made it appear as if those securities were backed by student loans. In one e-mail, for instance, “Camber Master Trust” was described as “Camber Funding Student Loan.”)

Tzolov appears to have moved out of his condominium, which is located a few blocks from Credit Suisse’s Madison Avenue office in the Flatiron District of Manhattan. He bought the property last year for $2 million, public records show.

Kenneth Breen, the lawyer for Tzolov, and Paul Weinstein, the lawyer for Eric Butler, the other target of the probe, declined to comment, as did a spokesman for the U.S. attorney’s office for the EDNY.

Full post as published by Law Blog - WSJ.com on July 31, 2008 (boomark / email).