Andrei Kozlov, 41, who oversaw bank licensing and led efforts to close down dozens of banks for violations of banking legislation, particularly for money laundering, died September 14 after being shot the day before along with his driver.
"Frenkel was notified today that he is being considered a suspect in the case," Igor Trunov said.
Trunov said a Moscow court would decide on issuing a warrant to prolong his client's custody Friday.
Frenkel, 35, was board chairman of the commercial VIP Bank, which was deprived of its operating license in June 2006 amid a money laundering inquiry.
The Central Bank found the bank had conducted a risky lending policy without setting up adequate reserves, violated accounting requirements and provided untrustworthy reporting. The scale of the violations posed a major threat to its clients' interests, the Central Bank said at the time.
The top prosecutor said more suspects in the murder case could be detained.
"We do not rule out that more suspects in the case will be detained," Yury Chaika said.
The Prosecutor General's Office said earlier Thursday a total of seven people, including the suspected mastermind of the high-profile murder, have now been arrested.
