Daily Local News (West Chester, PA)
ON THE HOT SEAT
Treasury pick defends foreclosure actions, asset disclosure
WASHINGTON >> Steven Mnuchin, President-elect Donald Trump’s pick as Treasury secretary, clashed with Democrats during a lengthy confirmation hearing Thursday over his handling of thousands of mortgage foreclosures and his failure to initially disclose to the committee $100 million in assets and interests in a Cayman Islands corporation.
Mnuchin said the failure to disclose the assets was an oversight that he had corrected when it was brought to his attention by staffers of the Senate Finance Committee. He said he had followed the advice of a lawyer who believed the disclosures were not necessary.
But Democrats seized on the issue as evidence of serious ethics challenges among Trump’s Cabinet nominees.
“Never before has the Senate considered such an ethically challenged slate of nominees for key Cabinet positions,” Senate Democratic Leader Chuck Schumer said in a statement.
In the hearing, Democrats on the Senate panel challenged Mnuchin’s explanations, suggesting it was because he did not want to reveal his involvement in a business that could be used as an offshore tax haven. Mnuchin said he had never used the Cayman Islands to avoid paying his taxes.
Mnuchin, one of many wealthy business executives Trump has picked for his Cabinet, said he had turned over 5,000 pages of documents to the committee and that some of the questions were complicated.
Democrats also attacked Mnuchin’s record when he ran OneWest bank, saying he failed to do enough to keep people from losing their homes. All of the criticism on the committee came from Democrats. Republicans widely praised Mnuchin’s record in business, indicating their support for his nomination.
During the hearing, Mnuchin defended his handling of thousands of foreclosures during the
height of the financial crisis, saying he had worked
hard to assist homeowners to refinance so they could keep their homes.
“Since I was first nominated to serve as Treasury secretary, I have been maligned as taking advantage of others’ hardships in order to earn a buck,” he said in testimony. “Nothing could be further from the truth.”
Mnuchin, a former Goldman Sachs executive, was questioned about his actions after taking over the failed IndyMac, whose collapse in 2008 was the second biggest bank failure of the financial crisis. Mnuchin assembled a group to buy the bank from the government, renamed it OneWest and turned it around, selling it for a handsome profit to CIT Group Inc. in 2014.
Mnuchin denied press reports that said he ran a “foreclosure machine.” He told the Senate Finance Committee that his bank extended over 100,000 loan modifications to borrowers who had fallen behind in their mortgage payments.
But several Democratic senators raised examples of residents in their own states who they said were not treated fairly in dealing with OneWest.
, including elderly homeowners, members of the U.S. military and one example of a person who lost their home although they were behind in their payments by less than $1.
Mnuchin said that not all of the bank’s decisions on foreclosures had been correct.
“To the extent there were any errors, I am sorry for that,” he said.
Mnuchin at various times was offered the chance to clarify statements that Trump has made on such issues as the value of the dollar and whether it would ever make sense to default on the government’s debt. Mnuchin said that the administration believed over the long-term that a strong dollar was a major benefit to the country. He said threats to default on the government’s debt as a negotiating ploy in budget negotiations was a bad idea.