'Substantial Assistance'
Prosecutors in a filing yesterday asked for leniency for Tzolov because of his "substantial assistance," including his aid in convicting Butler.
"This defendant did cooperate and effectively laid out the fraud that was committed and the fact that the banks and their customers have closed their eyes to their obligations to the public," Weinstein said in sentencing Tzolov. "Credit Suisse was careless in supervising various people."
David Walker, a spokesman for Zurich-based Credit Suisse, declined to comment.
Weinstein also ordered Tzolov to pay $1.11 million in restitution to victims and $250,000 in forfeiture to the government.
Tzolov and Butler worked as partners in Credit Suisse's corporate cash management group, a division that helped clients manage excess corporate cash holdings, according to court papers. They routinely falsified the names of the securities they put their clients in by, for example, adding "ed" or "student loan" and deleting "housing," according to prosecutors.
Higher Commissions
The brokers earned higher commissions from selling securities backed by corporate debt and mortgages than from selling those backed by student loans.
Their clients included GlaxoSmithKline Plc and STMicroelectronics NV.
Butler and Tzolov were allowed to keep $4.45 million in signing bonuses under a July 2010 arbitration ruling lost by their former employer, Morgan Stanley, at the Financial Industry Regulatory Authority. The two men joined New York-based Morgan Stanley after leaving Credit Suisse.
The cases are U.S. v. Tzolov, 08-cr-370, 09-cr-475 and 10- cr-83, U.S. District Court, Eastern District of New York (Brooklyn).