By Pam Martens and Russ Martens: May 19, 2017
If the plan was to soften the grilling by Democratic Senators at yesterday’s Senate Banking Committee hearing by bringing along his Stoic-faced fiancée Louise Linton, U.S. Treasury Secretary Steven Mnuchin was disappointed. Neither Linton nor Mnuchin should have been surprised. Mnuchin had faced an equally hostile reception from Democrats at his January 19 confirmation hearing before the Senate Finance Committee.
During yesterday’s hearing Mnuchin dispelled the lie that the Trump administration has fostered for months — that it was considering restoring the Glass-Steagall Act and breaking up the big banks on Wall Street. After Mnuchin attempted to say this had never been their position, Senator Elizabeth Warren called his testimony “bizarre,” “crazy,” and “like something straight out of George Orwell.”
Mnuchin’s reception from Senator Catherine Cortez Masto of Nevada was equally frosty. Masto, who previously served as the Attorney General of Nevada for eight years, told Mnuchin that “the dancing around that you’ve done” reminded her of “bankers and Wall Street executives who were in my conference room as Attorney General during the worst foreclosure crisis we’ve ever seen.”
Masto reminded Mnuchin that he had recently spoken at a conference “where the cheapest ticket to attend cost $12,000.” Masto said Mnuchin had joked at the time that “you should all thank me for your bank stocks doing better.” She said the remark had come during Mnuchin’s comments about his efforts to “roll back Wall Street reform, including under an Executive Order signed by President Trump before a room full of powerful Wall Street executives.”
After reading desperate pleas from her constituents to stand firm against the Wall Street banks, Masto told Mnuchin: “I have not heard today anything that you have said that is looking out for the interests of the people that I just talked about.” Mnuchin said he could reassure Masto that he was interested in looking out for all of those people.
The Democrats’ reaction to Mnuchin was something of a replay of what had occurred at his January 19 confirmation hearing before the Senate Finance Committee. A particularly harsh assessment had come from Senator Ron Wyden, who stated the following:
“Mr. Mnuchin’s career began in trading the financial products that brought on the housing crash and the Great Recession. After nearly two decades at Goldman Sachs, he left in 2002 and joined a hedge fund. In 2004, he spun off a hedge fund of his own, Dune Capital. It was only a few lackluster years before Dune began to wind down its investments in 2008.
“In early 2009, Mr. Mnuchin led a group of investors that purchased a bank called IndyMac, renaming it OneWest. OneWest was truly unique. While Mr. Mnuchin was CEO, the bank proved it could put more vulnerable people on the street faster than just about anybody else around.
“While he was CEO, a OneWest vice president admitted in a court proceeding to ‘robo-signing’ upward of 750 foreclosure documents a week. She spent less than 30 seconds on each, and in fact, she had shortened her signature to speed the process along. Investigations found that the bank frequently mishandled documents and skipped over reviewing them. All it took to plunge families into the nightmare of potentially losing their homes was 30 seconds of sloppy paperwork and a few haphazard signatures.
“These kinds of tactics were in use between 2009 and 2014, a period during which the bank foreclosed on more than 35,000 homes. ‘Widow foreclosures’ on reverse mortgages – OneWest did more of those than anybody else. The bank defends its record on loan modifications, but it was found guilty of an illegal practice known as ‘dual tracking.’ One bank department tells homeowners to stop making payments so they can pursue modification, while another department presses on and hurtles them into foreclosure anyway.”
Before the confirmation hearing concluded, Senator Wyden added the following:
“Mr. Mnuchin, a month ago you signed documents and an affidavit that omitted the Cayman Island fund, almost $100 million of real estate, six shell companies and a hedge fund in Anguilla. This was not self-corrected. The only reason it came to light was my staff found it and told you it had to be corrected.”
Louise Linton had also sat stoically behind her man at the January 19 confirmation hearing.