Democrats never got the answers they wanted from Steven Mnuchin regarding foreclosures at his bank, OneWest, during his confirmation hearings. Now they’ll have a second chance, with President Trump’s nomination of former OneWest CEO Joseph Otting to be comptroller of the currency.
Trump officially sent the nomination of Otting for the top bank regulatory post to the Senate Tuesday, and Democrats quickly indicated that the confirmation hearings would replay the tough examinations of OneWest foreclosures that took place during Mnuchin’s confirmation in January.
Then, Democrats mounted a concerted PR effort against Mnuchin, setting up a site specifically to solicit complaints from OneWest borrowers, and liberal groups ran ads against Mnuchin featuring customers who had been foreclosed on.
It is too early for Democrats to begin similar efforts for Otting, an aide said, but there is still lingering resentment that Republicans pushed Mnuchin through the Senate Finance Committee by cutting out Democrats, allowing Mnuchin not to answer questions to their satisfaction. He “didn’t exactly give straight answers to Democratic senators,” the aide said.
Democrats had attempted to stop the panel from advancing Mnuchin’s nomination to the full Senate by boycotting the vote, but Republicans responded by changing the rules to allow for a quorum without both parties present.
At issue was Mnuchin’s claim that OneWest hadn’t engaged in the practice of “robosigning” foreclosure documents, processing them en masse without properly checking that the proper procedures had been followed, during his tenure.
Democrats rejected his explanation, citing local news reports indicating the bank did engage in practices that are often described as robosigning in states including Ohio, Maine, Washington and Pennsylvania and the 2011 consent report the bank signed with regulators over its mortgage servicing. At the time, Mnuchin was the chairman of the bank and Otting its CEO.
“The president’s choice for watchdog of America’s largest banks is someone who signed a consent order — over shady foreclosure practices — with the very agency he’s been selected to run,” said Sen. Sherrod Brown, the top Democrat on the Banking Committee.
“As our nation faced a housing crisis that devastated our economy, OneWest put profits before working families and engaged in various ‘unsafe or unsound practices,'” Maryland Democrat Chris Van Hollen wrote in a letter to Mnuchin Tuesday. “That stands in direct contrast to the mission of the OCC.”
For Democrats, raising the issue of unfair foreclosures paints the administration as conflicted in its interests. It also highlights Democratic opposition to Republican efforts to reduce financial rules put in place in the wake of the crisis. Such regulatory relief would risk bringing back the practices that led to the crisis, Democrats have argued.
“With Mnuchin at Treasury and Otting at OCC, we should all be concerned that the mission of the OCC will be at risk,” said Rep. Maxine Waters, the top Democrat on the House Financial Services Committee.
