Ex-Citi CEO Apologizes For Financial Crisis

Photograph of Chuck Prince and Robert Rubin by J. Scott Applewhite/AP

According to Bloomberg News, former Citigroup CEO Charles "Chuck" Prince's prepared testimony in front of the Financial Crisis Inquiry Commission reveals that "he wasn’t aware of the mortgage-related securities that caused the bank’s biggest losses until the financial crisis struck." But that didn't matter, since “Everyone, including our risk managers, other banks and CDO structurers, all believed that these [mortgage-related] securities held virtually no risk. It is hard for me to fault the traders who made the decisions to retain these positions on Citi’s books." Now, Prince admits, their belief in the collateralized debt obligations "looks pretty unwise."

But the NY Times reports that Prince strayed from his prepared remarks today by apologizing, "Let me start by saying I’m sorry. I’m sorry the financial crisis has had such a devastating impact for our country. I’m sorry about the millions of people, average Americans, who lost their homes. And I’m sorry that our management team, starting with me, like so many others could not see the unprecedented market collapse that lay before us."

The Times adds that former Treasury and Citigroup board member Secretary Robert E. Rubin "also showed some contrition but stopped short of accepting personal responsibility for the bank’s woes" and also "cited at least nine different causes for the financial crisis, which formed a toxic cocktail that, he claims, 'almost all of us' missed."

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By Jen Chung in News on April 8, 2010 11:25 AM

Comments [rss]

NannyState

"We didn't become aware of a problem with mortgage-backed securities until the Fall of "07." But the market in trading MBSes got clogged in AUGUST '07. Chuck Prince seriously needs to DIAF.

drewo

Floating above this mess on his Golden Parachute, Chuck Prince has no clue what the average American has to deal with.

ANGRYGOD11

Hindsight is always 20/20.

To all the geniuses who knew this was going to happen, please tell us how much money you made betting against the bubble. It's a short list, but the people who knew and put their money on the table cleaned up.

hotstepper

Hindsight is always 20/20.

To all the geniuses who were CEOs of major financial institutions and knew this was going to happen, please tell us how much money you made betting against the bubble. It's a short list, but the people who knew and put their money on the table cleaned up.

*fixed that for you*

ANGRYGOD11

Thanks, but I can write for myself.

TODAY everyone knows the bubble was going to burst, but not when it really mattered. These CEOs should have known because they had the resources and it was their job, but let's not act as if we all knew what was coming and actually prepared ourselves for the obvious.

hotstepper

from your comment it seemed you were making excuses for the CEOs who are claiming ignorance. if that's not the case then we're on the same page.

investors and companies who actually profited from this (goldman sachs, et al) mess should be looked at by authorities very, very closely.

Smitty025

Please, anyone with half a brain could have seen how risky they were. That's why all these companies were trying to sell them so quickly. It was like a game of high stakes hot potato because everyone who knew about them knew that whoever had then in the end would crash and burn. That's why companies like Goldman were selling them and essentially placing bets on the same securities that they would fail.

Spook

I heard President Obama sent him a personal note on a yellow sticky that said "don't worry about it,

sh*t happends bro. Life is too short to sweat the small stuff. Take a few days off, jet to your island and enjoy your bonus, that's an order from the Pres!"

what_a_dick

dick

Mr. Shankly

Okfine. Now get off your asses and break up Citigroup.

Ishtar

If they held virtually no risk, why did JPM start minimizing their exposure to them before the "crisis"? Or am I wrong in my understanding of this?