Footnote 8

tier 1 banks.” CITI-SPSI 0036296. By the close of 1999, Citigroup’s one billion dollar obligorexception for Enron had been eliminated. The Yosemite prepays continued in 2000 and 2001.(6) Citigroup revised its structured finance policies.333. In August 2002, after Citigroup had been targeted for investigation by the SEC, theManhattan District Attorney, and the Permanent Subcommittee on Investigations of the UnitedStates Senate, Citigroup announced that it would no longer do business the way it did with Enron.Then CEO of Citigroup, Sanford Weill, issued a memo to all Citigroup employees in which herenounced the practices and policies through which Citigroup and its subsidiaries had aided andabetted the Insiders’ misstatement of Enron’s financial condition:At Citigroup, we are committed to greater transparency in the disclosure ofstructured finance transactions and we are answering the call from Washington andfrom investors by adopting strong initiatives ourselves.Quite simply, if a company does not agree to record a material financing as debton its balance sheet, Citigroup will only execute the transaction if the companyagrees to publicly disclose its impact to investors.Starting immediately, we will only do these transactions for clients that agree tomake prompt disclosure of the details of the transactions including management’sanalysis of the net effect the transaction has on the financial condition of thecompany, the nature and amount of the obligations, and a description of events thatmay cause an obligation to arise, increase or become accelerated. In addition, wewill only do these transactions for clients that agree to provide the complete set oftransaction documents to their chief financial officer, chief legal officer andindependent auditors.August 7, 2002 Memorandum from Sanford Weill to all employees (quoted in Exam. III, App. Dat 29 n.99) (emphasis added).334. More recently, as a result of Citigroup’s participation in manipulating Enron’sfinancial condition, the Federal Reserve Bank of New York forced Citigroup to formally revise itspolicies and practices regarding structured finance transactions. The Federal Reserve Bank ofNew York and the Office of the Comptroller of the Currency (collectively the “Federal Reserve”)604041v1/007457-109-