When Charles O. Prince III was chief executive officer of Citigroup Inc.  ($51.91 0.46%) from 2003 to 2007, he didn’t know about a surge in mortgage risk that his own investment bankers loaded on to its bank’s books.

Because such debt carried top credit ratings from firms such as Standard & Poor’s, few financial executives paid attention to the potential dangers.

"If someone had elevated to my level that we were putting, on a $2 trillion balance sheet, $40 billion of AAA rated, zero risk paper, that would not in any way have excited my attention," Prince told the Financial Crisis Inquiry Commission, according to a transcript of his testimony released in 2011.