Carl Levin

Mr. Sparks, turn to Exhibit 173. This is an email message, November 2006...

It is gambling--pure and simple raw gambling.

Thank you, Mr. Chairman, and, again, I congratulate you for this in-depth investigation.

I wouldn't trust you. If you came to me and wanted to sell me securities and you didn't tell me that you have a bet against that same security.

You are betting against the very product you are selling, and you are just not troubled by it.

You don't believe it is relevant to a customer of yours that you are selling a security to that you are betting against that same security.

That is being in a conflict of interest situation.

Do you think if your people think something is a piece of crap and go out and sell that, and then your company bets against it, do you think that deserves your trust?

I have difficulty when a firm such as yours has a strategic position to basically invest against the market.

That was a strategic positioning for the firm, is that correct?

According to the figures which we got, net profits from shorts, $3.7 billion. Net losses from longs, including the inventory pieces, which had been there for some time, were $2.9 billion.

Well, is that what you mean by reverse, that the person that comes in--is that what is meant by that term?

You sold about $700 million in subprime residential mortgage-backed securities, helping Fremont do that.

[F]remont refused to make any forward looking statements so we really got nothing from them on the crap pools...

If you have an adverse interest to your client when you are selling something to them, do you have the responsibility to tell that client of your adverse interest?

Did you not have a responsibility to answer a direct question, how can you get comfortable with these products from that source by saying we are going short, half the short is what we are buying?

Clearly, this system must be reformed so that Wall Street banks are not seen and do not act as unscrupulous operators who seek to profit from the public's misfortune.

You participated in the deal as one of the protection buyers.

You did not tell them you thought it was a shi**y deal?

You also took out a short position. Do you know how much you made?

So they thought you are on the long side, but not told you are on the short side of the same deal...

Don't you also have a duty to disclose an adverse interest to your client? Do you have that duty?

Should you have told that client--when they asked how are you getting comfortable with this, should you have told them you were going short if you were?

Goldman is selling Anderson securities to clients, but it is betting against that CDO.

Thank you so much, Senator Collins.