Lord Coe said he is "depressed" about allegations of Olympic tickets being sold on the black market.
"I'm not dismayed, or philosophical about it, I'm depressed." he told The Independent .
"I'm depressed given the number of warnings we gave them.
"When I went to [the NOC's conference] Acapulco in 2010 we warned them that the Metropolitan police were making arrests. The home secretary announced fines would be raised.
"That there would be zero tolerance, and they would be taking on the British press, the most forensic out there.
"I'm surprised anyone was prepared to take a punt."
Lord Coe was speaking at the official opening of the £9m corporate hospitality pavilion on the Olympic Park, where £4,500 tickets to the 100metre final remain unsold. He said the allegations would "not be a defining moment" and insisted that it did not affect the British allocation of tickets.
He said it would be "difficult to sustain the argument that there would still be a place in the Olympic movement" for those found guilty of wrong doing by the IOC's investigation.
Locog could still seize any unallocated tickets from the 54 countries implicated by The Sunday Times , but it would have to be done before the IOC's investigation was complete, making it "unrealistic", Lord Coe said.
“Let’s be realistic about this – there are 11 million tickets, 8 million tickets are in the hands of the British public that’s 75 per cent of the tickets. We’re delivering a Games, arguably the most popular Games ever to 204 National Olympic Committees, and that is to help people like my parents who went to LA on that system.
“That is not a disproportionate number of tickets going into the international marketplace for a Games as popular as the Games have proven to be in London.
“I don’t think this is a defining moment, it’s a moment we take very seriously and it's one I know from my conversations this morning with the IOC they take very seriously. There was a great deal of anger coming from Lausanne about the nature of these allegations – they are now looking in detail at them.
“I think we have to be realistic though with 39 days to go before the Games it’s unlikely we’re going to get the full pathology, but I know they are absolutely intent on treating it very seriously. I think it would be very difficult to sustain the argument that there would be a place for anyone in the [Olympic] movement [if found guilty].
“I don’t discuss private conversations but I can tell you that we’ve made the very obvious offer within their investigations that we will help in any way that we can.
“Fair play is not a concept rooted only in the stadium – there has to be confidence in every aspect of the delivery of the Games that there are legitimate processes . . . [and] if anyone has any unallocated allocation, then we have people in the UK who will take them’
“We’d need to know what had been allocated and whether there were any illegal transactions before doing anything – that’s why we have to wait for their investigation. The best brains will be trying to figure it all out. Clearly we’ll need to look at everything.
“I think we have to be realistic about this, with 39 days to go before the Games I think the scale of the allegations means it’s probably unlikely the full nature of the pathology will be known before that stage.
“Clearly it goes without saying that if any of those allegations in a substantive state are upheld at the first hurdle then clearly that’s very serious and sanctions will have to take place at that stage. t is now a case of the IOC understanding the nature of the allegations, starting the investigation and they will do that and then taking whatever learning’s going forward.”