Award-winning French investigative journalist and documentary filmmaker, Benoît Bringer, and his cameraman, Mathias Denizo, recently spent an afternoon around my kitchen table where they interviewed me regarding my role as a Citigroup whistleblower.
Benoît, or Ben as he prefers being called in the US, is based in Paris, France. He was part of the International Consortium of Investigative Journalists (ICIJ) Panama-Papers team which won a Pulitzer Prize in 2017 for their work. In 2017 he was also shortlisted as International Journalist of the year by One World Media.
Ben is working with the production company Premières Lignes producing and directing a documentary for French public television on the 10th anniversary of the financial crisis. The 70-minute film is expected to air first in France and will then be available worldwide in other language versions.
Considering the topic and also the current debate surrounding the proposed EU legislation which would implement whistleblower protections throughout the EU, this release is very timely. Hopefully, the documentary will strengthen the position of those arguing for needed EU whistleblower protections.
Ben is highlighting much of the blatant wrongdoing that contributed to the worldwide financial crisis that devastated many countries’ economies, including ours, not to mention millions of individual lives. He was interested in what had happened when I spoke out against the behavior I witnessed and reported at Citigroup and my continual efforts to warn management and the board of directors about the huge potential losses I knew existed.
I referenced my FCIC testimony that, starting in 2006, I discovered that over 60% of the mortgages purchased and sold by Citigroup were defective. Because Citi had given reps and warrants to investors that these mortgages were not defective, the investors could force Citi to repurchase many, many billions of dollars of these defective mortgages. This situation represented a large potential risk to the shareholders of Citigroup.
I started issuing warnings in June of 2006 and attempted to get management to address these critical risk issues. These warnings continued through 2007 and went to all levels of the Consumer Lending Group, including to the board of directors of Citi.
We continued to purchase and sell to investors even larger volumes of mortgages through 2007. And defective mortgages increased during 2007 to over 80% of production.
We documented the testimony I gave to the SEC (Securities and Exchange Commission) in July of 2008, three months before the banks were bailed out by our government, with Citigroup being bailed out in three successive bailouts, receiving over $350 billion in capital and toxic asset guarantees, and ultimately $2 trillion-plus in below-market loans from the bailout lending programs. As a result of the bailouts, by March of 2009, the US Treasury owned 36% of the common stock of Citigroup, the world’s largest bank.
Part of the interview also referenced how the SEC covered up and still refuses to release any of the 1,000 pages of documents I gave them evidencing the fraud.
We discussed the FCIC (Financial Crisis Inquiry Commission) hearings and my being required to edit my original 28 page written testimony down to 20 pages, omitting significant damaging evidence. The edited testimony was accepted as my official testimony and was posted on the FCIC website.
I provided details as to what I was specifically requested to edit out. The categories of the required edits (to be discussed further in a future post):
- Citigroup behavior – same as I witnessed in Oklahoma in the 1980s,
- SEC testimony – 1,000 pages of documents with no follow up,
- Sarbanes-Oxley violations of law,
- MBS fraudulent representations,
- Names and specific cover-ups, and
- Changes in employee status post Rubin email.
It was communicated to me that the requested edits were not optional. I voiced my belief to Ben that I was forced to remove these items from my testimony because the Citigroup public shareholders meeting was scheduled to be held two weeks after the FCIC televised testimony. Shareholders may have incited a riot if they had learned all of this beforehand!
Additionally, it was announced two weeks before the FCIC hearing that the US Treasury was going to sell, on the open market, its shares of common stock in Citigroup for a $7.5 billion profit, and my full testimony would have depressed the market price for the stock, jeopardizing the sale.
I also expressed my belief that if it had become public knowledge that our own government knew, from the SEC testimony, what Citigroup was doing before the bank bailouts and still bailed them out there would have been a public outcry! Heads would have and should have rolled!
I applaud Mr. Bringer for this work and thank him for letting me be a part of it. His interviews will take place all over the United States and hopefully bring out some stories that have not been heard before.
Perhaps documentaries like this will, in fact, raise public awareness, enough to prevent another financial meltdown. I’m also hoping it will raise public awareness in EU countries regarding how whistleblowers are treated for protecting the public interest.
Punishing whistleblowers, preventing truth to be fully told is costly, to a country’s economic well-being as well as their integrity. More stories like mine need to be told so we do not allow continual cover-ups to erode our financial wellbeing.
Richard Bowen is widely known as the Citigroup whistleblower. As Business Chief Underwriter for Citigroup during the housing bubble financial crisis meltdown, he repeatedly warned Citi executive management and the board about fraudulent behavior within the organization. The company certified poor mortgages as quality mortgages and sold them to Fannie Mae, Freddie Mac and other investors.
