Footnote 8

jointly conducted a review of Citigroup’s structured finance and prepay transactions with Enron.That review resulted in a written agreement between the Federal Reserve and Citigroup datedJuly 28, 2003, in which the Federal Reserve concluded that Citigroup’s transactions with Enron“raised concerns that the manner in which Citigroup and its subsidiaries participated in theStructured Transactions exposed them to significant risks.” Agreement between Federal Reserveand Citigroup dated July 28, 2003, at 2. To avoid future abuses of structured finance transactionsby Citigroup, the Federal Reserve required Citigroup to develop and submit “for review andapproval” written revisions to its policies for complex structured finance transactions. Among otherthings, those revised policies must ensure that Citigroup: (1) “identif[ies] transactions in which thecounterparty relationship or the nature of the transaction with the counterparty poses or may poseheightened legal or reputational risks to Citigroup or its subsidiaries”; (2) requires “complete andaccurate disclosure of the counterparty’s purpose in entering into the particular transaction”;(3) “assess[es] whether financial, accounting, rating agency disclosure, or other issues associatedwith a transaction are likely to raise legal or reputational risks for Citigroup and its subsidiaries”;and (4) conducts “a higher level review of the overall customer relationship . . . where thecounterparty’s primary purpose, goal or objective in entering into a transaction is to achieve anaccounting or tax effect.” Id. at 3-5 (emphasis added).b. Chase knowingly assisted the Insiders in misstating Enron’s financialcondition.335. Like Citigroup, Chase’s involvement in the Insiders’ manipulation of Enron’sfinancial condition was essential to the Insiders’ scheme. Chase knew the Insiders were using SPEtransactions improperly to inflate cash flow from operations and disguise debt as price riskmanagement’s liabilities on Enron’s financial statements. From at least 1998, Chase helped theInsiders achieve their improper goals by designing, financing, and/or implementing at least seven604041v1/007457-110-