Reflections from the Financial Crisis: Richard Bowen and Citigroup 

By Ian Herel

In the culmination of almost 2 years of internal whistleblowing at Citigroup, Richard Bowen sent an email in November, 2007, to Robert Rubin on the eve of his appointment to Chairman of the Board of Directors. His message was a warning to Rubin, detailing “breakdowns in processes and internal controls,” which led to a situation where 80% of mortgage loans purchased and sold by Citigroup were fraudulent or defective. Bowen, who was a Senior Vice President and Business Chief Underwriter, explained how Citi was falsely representing to its investors that these loans were underwritten to the bank’s strict credit policy criteria, and that this could leave Citi vulnerable to forced repurchasing of defaulted files, leading to huge losses. Two internal investigations had already confirmed the veracity of his claim. 

Despite the gravity of the threat, which the Executive Committee should have been obligated to report to the board, Bowen’s warnings continued to be ignored. Shortly thereafter, Bowen’s responsibilities “were gradually assigned to other managers” and three months after his email, Bowen was placed on administrative leave. Less than a year later, Citigroup would need $350 billion “in capital and toxic asset guarantees” from the federal government, as well as a $2.5 trillion in secret low-interest loans which were not made public until years later. 

In a conversation with Bowen, he made the point of explaining how Chairman Robert Rubin had been rewarded with his executive position at Citigroup. The former Secretary of the Treasury during the Clinton Administration, Rubin had helped lobby Congress on behalf of between Citicorp for their merger with Travelers Group. The record $70 Billion deal was also illegal under the Glass-Steagall Act, but Rubin used his influence to ensure its repeal. While the merger was permitted using a two-year temporary allowance in 1998, it ultimately became legal in retrospect when Congress ended Glass-Steagall in in 1999. Rubin’s lobbying helped end the decades long effort in the financial sector to strike down Glass-Steagall’s regulatory capabilities.   

By then, Rubin had left his position at the Treasury and as a reward for his lobbying, almost immediately joined Citigroup as a Chairman for the Executive Committee. He remained at Citi until 2009, earning over $120 million in a decade that ended with Citi’s insolvency.  

This example of “revolving door” corruption is just one of many that Bowen points to as an explanation for the 2008 crisis, and the lack of significant reform or prosecution afterward. Bowen’s blog, for example, frequently references the Corruptions Perceptions Index, where the U.S. has dropped out of the top-25 least corrupt countries in the world, and highlights failures from then Attorney General Eric Holder to pursue prosecution following criminal referrals from the Financial Crisis Inquiry Commission (FCIC) – including referrals for Rubin, and Citi CEO Charles Prince, based off Bowen’s FCIC testimony.  

“I’ve had to come to appreciate that the state of corporate ethics and the country’s ethics are so far beyond my story,” Bowen said, who noted that he was ultimately disappointed in the impact his whistleblowing had.  

Louis Clark, Executive Director of Government Accountability Project, attested to the disappointment many financial whistleblowers experience. “They didn’t get anything,” he said. “Obama bailed out the banks, and they didn’t impose reform. And then, no one was prosecuted for bank fraud, but they prosecuted over a thousand people after the Savings and Loans Crisis ten years earlier.” 

Despite his disappointments, Bowen still emphasized the importance of whistleblowing in the financial and corporate sectors. “The only thing keeping some of the abuses in check is whistleblowers, and Government Accountability Project is dedicated to supporting us,” Bowen said. “If they hadn’t come along, I would have been ground into a pulp.” 

“They give the whistleblower some respect, some intimidation,” he continued. “On the part of these larger organizations, they know they are not just dealing with an individual, but that they are dealing with the legal prowess of Government Accountability Project.” 

With the lack of prosecution and reform in the last crisis setting the stage for continued abuses and a worse crisis in the future, Clark believes that whistleblowing in the financial sector will continue to play an important role. “What we really need,” he said, “is a new wave of whistleblowing, and for that we need a robust ‘Know your rights Campaign,’ involving our partners from NGO’s, financial watchdog groups and good people in government. 

“These institutions should be put on trial and that is ultimately what whistleblowers do,” Clark continued. “People like to think about the ‘power of one’ to make change. But really, whistleblowers cannot do it on their own. They are more like the catalyst for change, and what they need to be successful is to be carried by a community to keep them from drowning and to keep their testimony alive.” 

If you believe you are witness to illegal or unethical actions at work, inform yourself of your rights by reading our resources page and consider reaching out to us for legal support. To learn more about Richard Bowen and his whistleblowing, please visit his website at

Government Accountability Project is the nation’s leading whistleblower protection organization. Through litigating whistleblower cases, publicizing concerns and developing legal reforms, Government Accountability Project’s mission is to protect the public interest by promoting government and corporate accountability. Founded in 1977, Government Accountability Project is a nonprofit, nonpartisan advocacy organization based in Washington, D.C.


Ian Herel is a Communications Associate at Government Accountability Project