Citi Underwriter Started Sending Higher-Ups Warnings Re: Mortgage Trubs Back In 2006

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Nobody really listened to him much though, probably because the subject lines of his emails to Bob Rubin and Co were fairly mundane ("THIS LOOKS REALLY FUCKING BAD, FELLAS") and he forgot to mark them high alert.

“I started issuing warnings in June 2006 and attempted to get management to address these critical risk issues,” said Richard Bowen, who was chief underwriter for correspondent lending in Citigroup’s consumer-lending group. “These warnings continued through 2007 and went to all levels of the consumer-lending group.” In a November 2007 e-mail headlined, “URGENT-READ IMMEDIATELY-FINANCIAL ISSUES,” Bowen said he warned top managers including then Executive-Committee Chairman Robert Rubin of “possibly unrecognized financial losses” among other risks.

The week after Bowen sent his e-mail to Rubin, he received a “very brief” call from a lawyer in the office of Citigroup’s general counsel, he said during his live testimony today. The lawyer assured Bowen his concerns would be taken “seriously,” he said. Bowen wasn’t contacted again until January 2008, when he explained “details” to lawyers in the general counsel’s office during a series of conference calls lasting a total of five hours, he said.

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