◆ SpookStack

UNCLASSIFIED To: San Diego From: San Diego Re: SD 205-0, 02/17/2011 counter party would sign the contract. If the vendor was a sole source, a form was signed by a supervisor one level above. There was no follow-up to inspect the books and records of vendors Sempra used. Once a vendor was approved, a purchase request for that vendor was signed by a supervisor and procurement representative. Any request over $50,o0o required legal review. Before payment was made to the vendor for products or services received, a certification by the receiver was needed. There have been no red flags found in the procurement process, but any vendor concerns would come to the attention of the Controller. To knowledge, Sempra does not maintain "due diligence" files on its vendors in Mexico. b6 b7C brieflv discussed his knowledge of knew for seyen (7) years. They traveled togeth ttended the annual FCPA training for Controllers. never voiced any FCPA/concerns to During balance sheet reviews, the bond paid to the Ensenada Attorney General's (AG) Office for the eviction of never came up. became aware of the bond in tne ontroller of Mexico informed that asked that the bond documents personal email account. confronted in San Diego office about the request. responded that he wanted to cover himself and have cuments for his records. asked if something was wrong with the transaction, but receive. no direct response from As a result of this reguest,. was not surprised when filed a lawsuit. evlew of the bond transaction revealed that it had been properiy accounted for, all documentation available, and the money could be traced back to the bank. stated that When became Controiier of LNG, he scrubbed the accounting recoras to find and fix errors. The fifth matter presented addressed the question of whether the mx$ioo,ooo bond paid to the Ensenada Ag's Office in 2006 was, still pending. provided a copy of a certified document issued by the AG's office dated 02/10/2011 advising that the mx$io0,oo0 was being reimbursed and was on its way back to Sempra. asked to know the status of the DOJ and SEc's investigation of the bond allegation. He expressed that the negative media attention being generated from and accusations wore embarrassing to Sempra and heeded to be put to bed. advised that there did not seem to be any need to further inyestigate the matter and that UNCLASSIFIED 6