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Rebecca Burns on The Steve Mnuchin Story

Turns out that the fat cat has thin skin.

The fat cat in this story is Treasury Secretary Steve Mnuchin.

The Steve Mnuchin who brought you that $1.5 trillion tax cut for the rich.

The Steve Mnuchin who worked at Goldman Sachs  for 17 years before becoming the kind of hedge fund guy that Donald Trump campaigned against.

The Steve Mnuchin who was CEO of OneWest Bank — the bank intricately involved in the foreclosure crisis.

The Steve Mnuchin who is now the subject of a new book – Fat Cat: The Steve Mnuchin Story — by Rebecca Burns and David Dayen (Strong Arm Press, 2019).

The book opens with a scene from UCLA.

“This was about two months after the passage of the tax bill. He was going to UCLA to give a public lecture on economic policy,” Burns told Corporate Crime Reporter in an interview last week. “People on the campus planned a protest. He was greeted by student protesters who were dressed like Marie Antoinette and were serving cake to passersby. They wanted to hammer home the idea that Mnuchin was French monarch level disdain with — let them eat cake. He started to talk about the $1.5 trillion tax cuts. He started to slowly get hissed at and eventually booed. Students called his tax bill the politics of cruelty. And some of them were carried out of the audience.”

“He was sniping at the Marketplace host Ky Ryssdal, who was conducting a conversation with him on stage. In the aftermath of this event, Mnuchin tried to prevent UCLA from releasing the video of the event. That insured that this event that maybe no one would pay attention to would become a news story for the next week. He was trying to prevent release of the video. News organizations were filing public records requests. And eventually, UCLA did release the video after saying that they had gotten Mnuchin’s consent.”

For his work at OneWest Bank, Mnuchin became known as “the foreclosure king.” His bank could make more money on foreclosure than on servicing loans – and so they foreclosed.

“This was a broad feature of the foreclosure crisis,” Burns said. “The incentives were misaligned. Loan services could make more money more quickly by foreclosing. OneWest Bank is not unique in this way. But it was one of the more notorious actors.”

“There was an investigation in California into their backdating of documents. The state Attorney General’s office, under Kamala Harris, declined to investigate further. But people in her office had uncovered evidence that they had been backdating documents to foreclose faster.”

David Dayen got ahold of a memo written by prosecutors in the Attorney General’s office urging Kamala Harris to bring a civil action against OneWest Bank. But she did not bring such a case.

Do we know why she did not bring such a case?

“We don’t know. And Kamala Harris was not alone. There was a broad lack of accountability at the state and federal level across the board, and not just when it came to OneWest Bank. Kamala Harris is in that club of high level prosecutors who failed to go after banks even when there was evidence of specific wrongdoing.”

When progressives want to throw the book at Senator Harris, I guess they could throw your book at her.

“In this book, it’s one small piece of information. I hope people understand it as part of a broader set of failings that she is certainly a part of. But I wouldn’t say she’s exceptional in that regard.”

Is there any information about whether Harris met with OneWest Bank officials about the case?

“I don’t think we have evidence of specific meetings.”

The former customers of his bank – OneWest Bank – are not fond of him.

“It’s not as if his customers were dealing directly with him. He was very high up in the company. But many customers, whose stories are featured in the book, remember when Steve Mnuchin was nominated as Treasury Secretary, they remember that Mnuchin was on their foreclosure papers. They remember that documents that were allegedly robo-signed were linked to Steve Mnuchin. He has a pretty concrete link to the misery of many ordinary people. The way he conducts himself in public is ignorant of that fact. He doesn’t seem to realize that his policies have inflicted a lot of pain and that people are reacting out of that pain.”

He’s known as the king of foreclosures, but he takes offense at that.

“Mnuchin says – It has been said that I ran a foreclosure machine, but in fact I ran a loan modification machine.”

While Americans might not be intimately familiar with foreclosure economics or tax cuts, they are familiar with road trips.

Let’s go to page 52 of Fat Cat.

“But perhaps the peak Mnuchin moment to dominate the news cycle, thus far, involved a familiar activity for the uber-rich Trump cabinet: using their lofty positions to feed at the public trough,” Burns and Dayen write. “In August 2017, the secretary’s actress wife, Louise Linton, posted an Instagram photo of the couple deplaning from a government jet.

“Great #daytrip to #Kentucky! #nicest #people #beautiful #countryside #rolandmouret pants #tomford sunnies, #hermesscarf #valentinorockstudheels #valentino #usa.”

“The tacky factor jumped when Linton berated an Instagram user who criticized her in the comments. And the incident turned into a full-fledged scandal when it turned out that Mnuchin may have chartered a government plane simply to take his wife to see the solar eclipse. (It would end up being one of a series of allegations of Mnuchin’s taxpayer-funded jet-setting: he reportedly requested a $25,000/hour military escort for his honeymoon, and cost the government nearly $1 million on plane travel in 2017 alone.”

“The treasury secretary responded to the eclipse dust-up in characteristically dickish fashion. “People in Kentucky took this stuff very seriously,” Mnuchin told the Washington Post. “Being a New Yorker, I don’t have any interest in watching the eclipse.”

“A recently obtained photo of Mnuchin and Linton, gazing up at the heavens, says otherwise. Think Progress, which got its hands on this smoking gun through a public records request, learned that the U.S. Mint had even procured their eclipse glasses for them.”

This book is about public outrage at overreach. The solar eclipse story is a minor event, but Mnuchin reportedly used taxpayer money to fly to Kentucky, near the line of the eclipse to see it after saying he had no interest as a New Yorker.

At the same time, regular people were driving hours in heavy traffic to get to see it. It’s the kind of thing that makes people angry. Minor incident – but not minor.

“Right, especially if you are going to see the eclipse and were caught in traffic for twenty hours,” Burns said. “And he flies down on the public dime.”

[For the complete q/a format Interview with Rebecca Burns, see 33 Corporate Crime Reporter 6(12), Monday February 11, 2019, print edition only.]

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