A top Democrat in the House on Friday criticized Steven Mnuchin, President-elect Trump’s choice for Treasury secretary, over a report on a leaked memo from California prosecutors recommending legal action against Mnuchin’s bank for breaking foreclosure laws.
Maxine Waters of California, the ranking Democrat on the House Financial Services Committee, said in a statement responding to the memo’s allegations against Mnuchin’s bank that “it shocks the conscience that the President-elect, who promised to ‘drain the swamp,’ would give the keys to the Treasury to a man whose bank engaged in massive fraud and profited off the backs of Americans that his company threw out on the street.”
Waters is the first Democrat to respond to the report, published in the Intercept this week and based on memos leaked from the California attorney general’s office.
The report details that prosecutors faulted OneWest, the bank managed and owned in part by Mnuchin, for fraudulently foreclosing on homeowners by violating statutes related to notice and waiting period requirements, falsifying documents, and more. They recommended enforcement action against the bank, but the then-attorney general, newly sworn-in senator Kamala Harris, declined to do so.
No Democratic senators so far have used the report to drum up opposition to Mnuchin’s candidacy. Doing so would raise questions about the judgment made by Harris, a rising star in the party, not to follow her staff’s recommendations to prosecute the case.
Otherwise, however, Democrats have prepared to oppose Mnuchin aggressively, including by seeking dirt on his bank from former customers.
The leaked memos include potentially damaging details about the bank’s operations, and Waters said that its contents should be “disqualifying” for Mnuchin.
Asked this week by the Hill newspaper why she didn’t pursue the case against OneWest, Harris declined to give a full account. “We went and we followed the facts and the evidence, and it’s a decision my office made,” she said.
