Subject: Price-verification findings, and my effort to resign

From: Hong, Victor, RBSGC (Victor.Hong@rbsgc.com)

To:

Date: Friday, November 2, 2007 3:33 PM

On October 30, I urged Bruce Jin and Lauren Rieder to convince senior management to mark down the
super-senior ABS CDO tranches immediately by at least 50%. He said to her and me that I have been
tremendous "value-added" as a risk manager, to clarify what this complex product is truly worth. Bruce
and Lauren said that, while they are trying to convince senior management to approve such action, I
should sign-off for October price verification even if the marks are not corrected, just to keep our
processes going without visible disturbance.

I told him that such would be intolerable to me, and that GCM had breached its obligations to me per my
hiring contract, even though I have fulfilled mine. So, I said that I have no choice but to resign. Bruce
asked me to hold off until November 5, in case he is able to convince senior management in face-to-face
London meetings beforehand.

On November 1, Lauren Rieder admitted to Ming Lin and me that, she knowingly should not have
represented in her September month-end price verification sign-off that no data existed to challenge
those marks. After all, by late September, I had already provided her and Bruce much independent
market analysis, showing that GCM was likely over-marking its super-senior ABS CDO tranches at least
30%.

______________________________________________
From: Hong, Victor, RBSGC

Sent: Friday, November 02, 2007 6:55 AM

To: Berberian, Richard, RBSGC; Choi, David, RBSGC; Cui, Hong, RBSGC; Dhaliwal, Navdeep, RBSGC; Harris, Michael, RBSGC; Huang,
Sylvia, RBSGC; Luo, Dustin, RBSGC; Rieder, Lauren, RBSGC; Zhu-Carnevale, Joseph, RBSGC; Jin, Bruce, RBSGC; Asare, Henry, RBSGC

Subject: Michael Smirlock, who ran Laser Mortgage Management, a closed-end fund.

http://www.nytimes.com/2007/11/02/business/02insider.html?_r=1&ref=business&oref=slogin

Notably, this trader was convicted and jailed for mis-marking MBS and ABS. Thank you.
 Victor Hong, Risk Management
RBS Greenwich Capital
203-618-2753

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