[CUSTOMER'S] LETTER OF COMPLAINT WAS RECEIVED BY MY FORMER EMPLOYER SALOMON SMITH BARNEY. IN JUNE OF 2003, I WAS CONTACTED BY THE MANAGER OF THE SMITH BARNEY BRANCH OFFICE IDENTIFYING [CUSTOMER'S] COMPLAINT. THE CONTENT OF WHICH, AS EXPLAINED TO ME, WAS THAT [CUSTOMER] WAS FRUSTRATED THAT HE HAD BEEN ASSIGNED ANOTHER ADVISOR AND NOT BEEN CONTACTED BY THE NEW ADVISOR SINCE MY LEAVING. IT WAS ALSO EXPLAINED THAT HE ALLEGED THAT THERE WERE STILL UNRESOLVED ISSUES IN REFERENCE TO DISCOUNTS IN COMMISSION THAT HAD NOT TAKEN PLACE. I HAVE SINCE LEARNED THAT [CUSTOMER'S] LETTER ALLEGED I LEFT HIM STILL PAYING OFF A LOAN I ARRANGED OWING HIM OVER $500O IN ADVANCED COMMISSIONS. [CUSTOMER] HAS BEEN A CLIENT SINCE 1994. WHEN I TRANSFERRED MY BUSINESS TO SALOMON SMITH BARNEY IN 1999, [CUSTOMER] CHOSE TO TRANSFER HIS ACCOUNTS TO ME. ABOUT TWO YEARS AGO I ADVISED [CUSTOMER] TO SELL SOME OF HIS EXISTING SECURITIES AND PURCHASE OTHER SECURITIES. THE RECOMMENDATION, STOCKS AND THE AMOUNTS WERE VERBALLY DISCUSSED OVER A TELEPHONE CONVERSATION. SHORTLY FOLLOWING THE TRADES, WE LEARNED THAT I HAD OVER PURCHASED IN THE AMOUNT OF APPROX. $20,000. AS SOON AS THIS WAS DISCOVERED [CUSTOMER] AND I HAD A CONVERSATION TO RESOLVE THE ERROR. THE RESULT OF WHICH WAS TO GO ON MARGIN SINCE HE DID NOT HAVE THE CASH TO PAY FOR THE TRADES. [CUSTOMER] HAD A MARGIN AGREEMENT AND FELT THIS WAS THE BEST DECISION AT THE TIME. AT THIS TIME HE ALSO ASKED ME TO DISCOUNT HIS COMMISSIONS IN THE FUTURE. I AGREED TO DISCOUNT HIS COMMISSIONS ON FUTURE TRANSACTIONS. DURING THE PAST TWO YEARS THE MARKET CONTINUED TO DECLINE AND [CUSTOMER] AND I AGREED NOT TO MAKE ANY CHANGES TO HIS PORTFOLIO. [CUSTOMER] AND I SPOKE ON NUMEROUS OCCASSIONS DURING THAT PERIOD AND NOT ONCE DID HE BRING THIS UP TO ME AS AN ISSUE.

$5,000.00

THE COMPLAINT STEMS FROM ACTIVITY IN 2001. AT THE TIME I LEFT SMITH BARNEY, I HAD NO KNOWLEDGE OF THE COMPLAINT OR ANY DISSATISFACTION OF [CUSTOMER]

CLIENT ALLEGES FA MADE UNAUTHORIZED TRADES, UNSUITABLE TRADES AND CHURNED THE ACCOUNT. DAMAGES ARE ALLEGED TO BE IN THE HUNDREDS OF THOUSANDS OF DOLLARS.

$15,000.00

CLIENT ALLEGES THAT WHILE FA WAS OUT OF OFFICE DUE TO HIS FATHERS DEATH, THE CLIENT'S PORTFOLIO WAS IGNORED AND HIS INSTRUCTIONS REGARDING FIRST PLUS WERE NOT FOLLOWED. LOSSES WERE CALCULATED TO BE IN EXCESS OF $5,000.

CLAIM WAS DENIED THE CLIENT MADE AN UNSOLICITED PURCHASE OF FIRST PLUS FINANCIAL. THE CLIENT DECLINED MY SUGGESTION TO PLACE A STOP LOSS ORDER ON FIRST PLUS. MY ABSENCE FROM THE OFFICE DUE TO MY FATHER'S DEATH WAS UNAVOIDABLE.