The international manhunt for a fugitive banker who cut off his ankle bracelet to avoid trial has ended with his arrest in Spain, law enforcement sources said today.
Spanish authorities in Marbella made the arrest of accused white collar criminal Julian Tzolov with help from the FBI, law enforcement sources said. The Justice Department has not yet issued a statement on the arrest. However, federal officials said Tzolov was nabbed with about $1,200 in cash and a gold watch.
The former Credit Suisse banker is accused of massive securities fraud and his trial is due to start in Brooklyn federal court next week.
He disappeared May 9 when he cut his ankle bracelet and hit the road to avoid trial, federal prosecutors said. He had been freed on $3 million bail and allowed to return home to his apartment at 225 Fifth Avenue. Tzolov, who is from Bulgaria, had also been ordered to surrender his passport.
The ex-banker is accused of lying to his customers about certain sales in order to gain higher commissions for himself.
Opening statements in the joint trial for Tzolov and his former colleague at Credit Suisse, Eric Butler, are due to begin Monday.
The pair are accused of selling securities to clients that were backed by risky subprime mortgages. But investigators said the two bankers lied to investors saying the securities were backed by low-risk student loans. The FBI said the scam went on from 2004-2007 with Tzolov and Butler sending emails with false information about which securities had actually been bought. At the time, FBI officials said the pair had only sold their clients a "bill of goods" and that their actions were "unscrupulous and illegal."
Tzolov's attorney Ben Brafman maintained that he did not know his client's whereabouts.
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Prosecutors said the fraud reached the hundreds of millions with investors here and abroad suffering staggering losses.
Prosecutors had wanted the trial delayed because of Tzolov's absence and because key victims and witnesses are overseas. To "now hold two separate trials would victimize those investors again" by making them travel twice, prosecutors said in a letter to Judge Jack Weinstein.
Holding the trial while Tzolov is on the run is “particulary problematic,” attorenys had argued.
Tzolov was one of a string of white collar fugitives to flee while out on bail. Officials said Jacob Kobi Alexander, former CEO of Comverse Inc. fled New York to Namibia to avoid trial. The ex-CEO of Symbol Technologies fled to Sweden before his arrest and now lives in an ocean front villa in Sweden.
Bayou hedge fund fraudster Sam Israel disappeared for a time after faking his own suicide off the Bear Mountain Bridge last summer. He was later captured and today was give extra jail time for the stunt.
