Citigroup Execs Knew of Subprime Risk, Underwriter Testifies
Panel hears of urgent e-mailed warnings.
April 06, 2010 at 08:00 PM
3 minute read
The original version of this story was published on Law.com
A chief underwriter at Citigroup warned executives as early as mid-2006 that subprime mortgage pools the bank was buying violated its own credit standards, Bloomberg reported Wednesday.
“I started issuing warnings in June 2006 and attempted to get management to address these critical risk issues,” Richard Bowen, who worked in Citigroup's consumer-lending group, told the Financial Crisis Inquiry Commission Wednesday. “These warnings continued through 2007 and went to all levels of the consumer lending group.”
At the time, a lawyer from Citigroup assured Bowen his concerns would be taken seriously. His employment with the bank ended in January 2009.
A spokesperson for the bank said Bowen's concerns were “promptly and carefully reviewed.”
Former Chief Executive Charles Prince and Richard Rubin, former chairman of the executive committee of Citigroup's board of directors, are set to face the commission Thursday. Bowen said Wednesday that Rubin was among top managers he warned.
To read the full story about Bowen's testimony, click here: http://www.bloomberg.com/apps/news?pid=20601087&sid=a8LY70wJSiDk&pos=4
A chief underwriter at
“I started issuing warnings in June 2006 and attempted to get management to address these critical risk issues,” Richard Bowen, who worked in
At the time, a lawyer from
A spokesperson for the bank said Bowen's concerns were “promptly and carefully reviewed.”
Former Chief Executive Charles Prince and Richard Rubin, former chairman of the executive committee of
To read the full story about Bowen's testimony, click here: http://www.bloomberg.com/apps/news?pid=20601087&sid=a8LY70wJSiDk&pos=4
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