Accused ex-CS trader caught after months on run

By Grant McCool

NEW YORK (Reuters) - An indicted former Credit Suisse Group (CSGN.VX) (CS.N) trader was arrested in Spain on Wednesday, U.S. law enforcement sources said, two months after he fled facing trial on fraud charges.

Bulgarian national Julian Tzolov, 36, was charged last September along with another former CS trader Eric Butler, with fraudulently selling $1 billion (609 million pounds) worth of mortgage-backed auction-rate securities to clients.

Tzolov was arrested by police in Spain, but no further details were immediately available according to two law enforcement sources. They asked not to be identified because details of the ex-trader's return were still to be worked out by authorities.

In a letter filed in court, the U.S. Attorney for the Eastern District of New York, Benton Campbell, said "the government writes to inform the court that the defendant (and fugitive) Julian Tzolov has been apprehended."

The letter to presiding Judge Jack Weinstein gave no other details. A trial was set to start on July 20 in Brooklyn federal court for Butler, 37, and Tzolov, but it was unclear whether it would go ahead as scheduled.

The judge is hearing a previously scheduled pretrial argument on Thursday and more information may be revealed then.

FUGITIVE SINCE MAY

The arrest of Tzolov, who escaped on May 9 from house arrest and electronic monitoring in his New York apartment, came as a new indictment was unsealed against him and his former colleague.