Free Answering Brief in Opposition - District Court of Delaware - Delaware

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i I Sub'ect: RE: Research of Exce tions found b Arthur Andersen re: Neilson
From: Andrew N. Yao
Date: E2/1771999 3:17:34 AM
To: Perry Turnbull; Gary Hawthome
Messa e Bod `
As a rule, we should keep school reporting separated from investor reporting. This should appiy to all
situations going forward and should be built into our IT.
This is the first that I knew that investor information was provided to NEI in the litigation. Once again, we
are our own worst enemy.
Why was this done?
Ptease provide me with you recommendations as to next steps. We need to be able to resolve this issue with
a reasonable explanation that wil} not be contrary to our financial audit and static pool.
~———- Original Message ----- Q `
From: Perry Tumbull .
Sent: Thursday, December 16, 1999 5 :41 PM
_— `~ ·` `*, , To: Andrew N. Yao; Gary Hawthorne
`· ·‘ Subj ect: RE: Research of Exceptions found by Arthur Andersen re: Neilson
I believe that the reports that were run in the past contained TC60 references. In addition, even our funding
reports to NEI showed evidence of payments made to accounts tht were actually TC60 postings. When the
litigation began Tian- ran itemized reports that contained the '}`C6O postings inthe transactions} history of
each. account. Between our earlier ttmding reports and 'I‘ian’s report the questions regarding these payments
became more focused. At the root of the concern was NEI’s claim or concern that they were not getting _
credit for payments they thought were made by students when in fact a TCGO posting had occurred. -
In short I believe the reserve payments (TC60's) have been in most ofthe data NEI, Pepper Hamilton, and
Arthur Anderson have seen.
————Origina1 Message —————
From: Andrew N. Yao . _ _
Sent: Thursday, December 16, 1999 3:56 PM Z
To: Gary Hawtbome _
Ce: Perry Turnbull
Subject: RE: Research of Exceptions found by Arthur Andersen re: Neilson -
Why do we have reserve payments in the NEI database? E
——~— ——Origina} Message ————— {
, From: Pat Kartha ` ·
’ Sen t: Thursday, December 16, 1999 11:48 AM . Z
To: Perry Tumbull; Andrew N. Yao F
Cc: Gary Hawthorne ‘ E
Subject: Research of Exceptions found by Arthur Andersen re: Neilson
tile:}/C:\Documents%2Oand%2OSettings\dpancotti\Tsocal%20Settings\Tempcrary°A»20h1temet%2{tFile... IOI4/2006

Case 1 :04-cv-01551-JJF Document 379-17 Filed 10/05/2007 Page 3 of 4 E
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E; fi. Arthur Andersen compared one day oftrzmsactions iiom our daiebase and the daily settlement reports for
each month of 1996 and 1997 and have asked me to research differences.
My immeciiate problem is that I cannot explain why the reserve payments on the data base in May 1996 do
not match the reports (see May 1996 below): I currently have no way to explain what happened to AA. Any
help wouki be appreciated. ·
Thank you.
AA sent me the first six months of 1996 to review. Of these six months, four had differences.
February 1996 Two days were posted together
Two payments on the data base are not on the daily settlement report. There is no record of how the cash _
received for ihese two payments was deposited to the bank.
March 1996 One payment on the date base is not on the daily settlement report. There is no record of how
the cash received for this payment was deposited to the bank.
May 1996 Thfee payments on the data base are not on the daily settlement report. There is no record of how I
the cash received for those three payments was deposited to the bank. g
'1`hexe are $8,800.58 in TC6O‘s{rese1·ve payments) in the data base that are not on any daily settlement ’
report. I have no idea when these payments were applied to the accounts. As a guess, maybe they were
` ·,..s~* applied later and pre~éated to make the portfoIio.10ok more am·ac%:ive,pzicr to the first securitization? AA.
has asked for "proof" that ell '1`C60s were payments from the reserve, not cash from students. I can show
this with general ledger entries for most ofthe cases, however without a record of when these payments
were put into the system, I mn not sure that I can give AA any "prooi“ for these payments.
June 2996 Two payments on the data base are not on the daily settlement repoii. There is no record of how
the cash received for these payments was deposited to the bank.
n Outlook Header Information
Conversation Topic: Research of Exceptions foimd by Arthur Andersen re: Neilson
Subject: RE: Research of Exceptions found by Arthur Andersen re: Neilson
From: Andxew N. Yao
Sender Name: Andrew N. Yeo . .
To: Perry 'Pm‘r1bui1; Gary Hawthcme `
Received By: Gary Hewihome - .
Delivery Time: 12/17/1 999 8:17:34 AM · . ; .
Creation Time: 12/28/1999 2:20:42 PM _ = I · · - - ‘
Modification Time: 12/28f1999 2:20:42 PM. .
. S Submit Time: 12/1 'N1999 7:54:52 AM .
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