Listening to The Big Short Companion from Against The Rules podcast, revisiting the real people behind 2008 events to ask about their experiences.
This part struck me - Season 6, Episode 3, when talking to Vinny (Vincent) Daniel about the sub-prime debt signals. Michael Lewis (The Big Short book author and podcast host) was talking to Steve Eisman's FrontPoint Partners team about their perspectives.
This is what had me shouting, It was Vinny responding to a basic question: Why didn't the big institutions act?
"Greed and money. That's the only way that in my head that rationalizes. I always assume that people saw what I saw, particularly the people that were this close to the situation, that were analyzing these bonds and these, they knew, they had to know. But there was just too much money to be made on the incremental subprime loan. There was just too much money to be made. So they all turned, the most intelligent ones turned the blind eye."
Why shout, because greed and money is a convenient avatar. Having worked in different kinds of due diligence it is far more subtle and familiar. Corporations chew up and spit out people positioned against the direction of travel. When you have known, but unacknowledged issues, lots of people start jockeying for optimal positions. Planning how to stay standing in the aftermath and take advantage of chaos. No-one wants to shout fire in a crowded theatre, but they do check exits, eye routes, and estimate who they can outpace.
When that takes hold it is still BAU on the surface, but back room chats and meetings offsite escalate. Folk bide their time, collect evidence, watch others, and note who breaks ranks when moral limits are reached. Some snap noisily, warning of a coming crisis. The cagey cohort note reactions. See who keeps their job and who doesn't. Watching where orders to keep calm and carry on come from.
Richard Bowen from Citigroup did shout fire. What happened then is an object lesson in integrity meeting deals signed in career-limiting blood:
When You Are Right But Damaging To The Narrative
Bowen was a Senior Vice President and Business Chief Underwriter at Citigroup's Consumer Lending Group. He was responsible for quality control on approximately $90 billion in residential mortgages that Citigroup purchased annually from other lenders, then sold on to Fannie Mae, Freddie Mac, or packaged into securitisations.
What he found: When he took on the role in early 2006, he discovered that around 60% of the mortgages flowing through his area didn't meet Citigroup's own underwriting standards. By 2007, that figure had risen to over 80%. Many were not just defective but fraudulent, yet Citigroup was certifying to investors that these loans met its credit policies.
What he did: From June 2006 onwards, Bowen issued warnings through every channel available to him: weekly reports, committee presentations, emails, and direct conversations. He described it as "yelling for a year and a half, going way up the chain of command."
On 3 November 2007 - the day before Robert Rubin was to be named Chairman of the Board - Bowen sent an email directly to Rubin, along with the Chief Financial Officer, Chief Auditor, and Chief Risk Officer. The email detailed breakdowns in internal controls and requested an outside investigation. He pointed out that failing to disclose this to shareholders violated the Sarbanes-Oxley Act.
What happened: Bowen was stripped of most of his responsibilities and informed his physical presence was no longer required at the bank. He was eventually separated from Citigroup in January 2009.
He testified before the SEC in July 2008 - three months before the TARP bailouts - providing over 1,000 pages of documentary evidence. The SEC took no action. He later gave nationally televised testimony to the Financial Crisis Inquiry Commission in April 2010.
The aftermath: No Citigroup executives were prosecuted. The bank received $45 billion in TARP bailout funds. In 2014, Citigroup settled with the Justice Department, which stated the bank had "routinely ignored warnings" about defective mortgages - precisely what Bowen had been saying since 2006. His name wasn't mentioned at the settlement announcement.
Bowen shouted. The cagey cohort hedged. And the theatre burned anyway
References
Podcast Source Against the Rules: The Big Short Companion, "The FrontPoint Boys," Season 6, Episode 3, 28 October 2025 https://podcasts.apple.com/gb/podcast/against-the-rules-the-big-short-companion/id1455379351?i=1000733732829
Vincent Daniel and FrontPoint Partners Lewis, M. (2010). The Big Short: Inside the Doomsday Machine. W.W. Norton & Company.
Richard Bowen — Primary Sources Financial Crisis Inquiry Commission testimony and report (January 2011) https://fcic.law.stanford.edu/report
Bowen's written testimony to FCIC (April 2010) https://fcic-static.law.stanford.edu/cdn_media/fcic-testimony/2010-0407-Bowen.pdf
Richard Bowen — Reporting and Profiles Wikipedia: Richard M. Bowen III https://en.wikipedia.org/wiki/Richard_M._Bowen_III
Government Accountability Project: "Reflections from the Financial Crisis: Richard Bowen and Citigroup" (January 2023) https://whistleblower.org/blog/reflections-from-the-financial-crisis-richard-bowen-and-citigroup/
Americans Who Tell The Truth: Richard Bowen portrait https://americanswhotellthetruth.org/portraits/richard-bowen/
Dallas Morning News / Watchdog Nation: "Whistleblower Richard Bowen hits Citigroup, then federal government" https://watchdognation.com/whistleblower-richard-bowen-hits-citigroup-then-federal-government/
60 Minutes Interview CBS News: "Prosecuting Wall Street" (December 2011) Featured Bowen's account of the 80% defective mortgage rate and being ignored by Citigroup leadership.
Citigroup Settlement US Department of Justice: Citigroup settlement announcement (July 2014) The DOJ stated Citigroup had "routinely ignored warnings" about defective mortgages.
Richard Bowen's Website https://richardmbowen.com