Citigroup CEO decries 'patchwork' regulation
LOS ANGELES (Reuters) - Citigroup Inc. (C.N) Chief Executive Chuck Prince said on Thursday some subprime lenders flooded communities with inappropriate mortgage products, skirting what he described as a "patchwork" of regulation.
Prince, the head of the world's largest bank, didn't name any names, but said some mortgage lenders took advantage of light regulation.
"People find out how to game the system to get capital through the least possible regulatory oversight," Prince said. "When that happens, bad people do things to harm our community. ... Very exotic, aggressive mortgage products were pumped into communities where they are not appropriate."
Prince made his remarks at the Greenlining Institute's annual economic summit in Los Angeles.
He said negative amortization mortgages, for example, have had a corrosive effect on communities.
"We need to find a way to close down regulatory arbitrage, fill in the gaps of regulatory oversight," Prince said.
