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It was a lucrative investment that now poses a huge hurdle for him during the confirmation process to become Treasury Secretary.
Senator Ron Wyden, the lead Democrat on the committee that will hold his confirmation hearings, told last month that Mnuchin has a “history of profiting off the victims of predatory lending.” But while the hearings might become heated, if Mnuchin has enough support from Republicans, in the end that heat won’t really matter.
“Because of One West’s breach, [plaintiffs] have been injured, including suffering negative credit consequences and some losing their homes through foreclosure sales that should have never occurred,” the complaint states.
The bank, now under new ownership, settled the case this past August for an undisclosed amount.
Barney Keller, a spokesperson for Mnuchin, told me in an email that the Treasury Department’s findings are “garbage” and the leaked memo is “meritless.” Regarding the regulatory findings, he said that “the exact same consent order was agreed to by all 14 of the major financial institutions that were heavily involved in the mortgage industry.
That involved requiring Mnuchin and other bank executives to write rules about how employees are supposed to work with borrowers to handle foreclosures, creating a process to ensure employees’ statements in court documents are accurate, plus a long list of other rules to make sure employees don’t break the law.
Other cases against the bank were dismissed or settled, and several remain open.
In 2015, Mnuchin sold the bank, which Bloomberg estimates earned him 0 million in personal profit.
Mnuchin—a former Goldman-Sachs partner—is now preparing to lead the same department that once reprimanded him for his banking practices.
The Treasury Department’s findings mirror some of those found by state prosecutors in a 2013 memo leaked this week to the , which alleges that Mnuchin’s bank broke foreclosure rules and engaged in “widespread misconduct” during the housing crisis.