Steven Mnuchin

Steven Mnuchin is Secretary of the Department of the Treasury.

  • born December 21, 1962 in New York City
  • Parents: Elaine Terner Cooper of New York and Robert E. Mnuchin of Washington, Conn. His mother is a vice president of the International Directors Council of the Solomon R. Guggenheim Museum and a director of the Byrd Hoffman Foundation, which supports the arts. His father, who retired as a general partner at Goldman, Sachs, owns C&M Arts, an art gallery in New York. NY Times
  • graduated 1985
  • Bachelor's from Yale University Bloomberg
  • partner at Goldman Sachs in 1994
  • a divorced (2104) father of three LA Times & NY Times  & twice married now engaged to Scottish actress, Louise Litton, Bloomberg
  • Before divorce Mnuchin and his ex-wife were considered stalwarts in high-society philanthropy world of New York and Los Angeles.
  • employed seventeen years at Wall St. investment bank Goldman Sachs LA Times
  • deeply involved in developing the president-elect's tax proposals NPR
  • financed major blockbusters such as American Sniper, Gravity, Avatar and Life of Pi. Bloomberg
  • "The bank (IndyMac) was renamed OneWest Bank, and Mnuchin became its chairman and CEO. The bank developed a reputation during the recession for being quick to foreclose on delinquent homeowners, closing on more than 36,000 households under Mnuchin, according the housing-advocacy group California Reinvestment Coalition." NPR

Timeline

Conflicts of interest

From The NY Times

S"To date, the Trump transition team has not commented on whether Mr. Trump continues to own stakes in Mr. Paulson’s firm and other hedge funds listed on the disclosure statement." 

From Bloomberg

"Investment managers whose funds hold common or preferred shares of Fannie Mae and Freddie Mac include Bruce Berkowitz of Fairholme Capital Management and hedge fund managers John Paulson, Bill Ackman and Richard Perry.

Fairholme’s Berkowitz, who endorsed Trump, was one of the winners on Wednesday as Fannie Mae and Freddie Mac securities climbed. His two biggest holdings, preferred shares in both companies, added about $220 million in value as of 10:25 a.m., according to data compiled by Bloomberg.
According to Trump’s most recent personal financial disclosures, the president-elect owns between $3 million and $15 million worth of funds managed by Paulson, who’s served as a political donor and economic adviser to Trump." 

From The NY Times

"One of the lenders that have extended credit to Mr. Trump is Mr. Mnuchin’s Dune Capital. Dune was among a syndicate of lenders led by Deutsche Bank for the construction of his Trump International Hotel & Tower, a 92-story skyscraper in Chicago. Mr. Trump sued the lenders, including Dune, in 2008 to extend the terms of the loan on the basis of “unprecedented financial crisis in the credit markets.” The suit was later settled.

"Mr. Mnuchin’s firm was also involved in investing in Trump Waikiki in Hawaii. 'I haven’t really commented on what business we’ve done together,' he said. 'I would describe it as more of a personal relationship than a professional relationship.'” 

From The NY Times

HUD (Department of Housing and Urban Development) is investigating complaints about OneWest's foreclosure practices in the reverse mortgage business. 

From Variety

"disgruntled Relativity investors privately are questioning how a bank Mnuchin once headed –OneWest Bank of Pasadena – was allowed by Relativity to drain $50 million from the studio just weeks prior to the July 30 insolvency filing." 

Affiliations

Senators who are in conflict with Mnuchin

  • Republican lawmakers over his stance on Fannie Mae and Freddie Mac: Jeb Hensarling, the Texas Republican who chairs the House Financial Services Committee & Tennessee Republican Senator Robert Corker Bloomberg
  • Senate Democrats set up a website soliciting complaints from victims of Mnuchin's days as the "Foreclosure King" at OneWest.

Analysis


From the LA Times:

"Mnuchin’s group netted billions thanks in large part to a much-criticized deal that allowed the investors to buy the bank at a big discount while passing off as much as 75% of its loan losses on the Federal Deposit Insurance Corp. Mnuchin and his group paid about $1.6 billion for the bank and sold it last year to New Jersey lender CIT Group for $3.4 billion.

"Between the sale price and hefty dividends paid out from 2011 to 2015, Mnuchin and his group made a profit of more than $4 billion. It’s not clear how much of a profit Mnuchin personally made, because his stake in OneWest was undisclosed.

From The Nation:

Within a year, the group that the Los Angeles Times called a “billionaires’ club of private financiers” had paid themselves dividends of $1.57 billion. The Nation

From The NY Times

"The banker's involvement in OneWest Bank following the 2008 housing market crash could complicate his confirmation."

From The NY Times

"Mr. Mnuchin shares a network with some of the biggest names in the $3 trillion hedge fund industry, but his work with Mr. Paulson is of particular interest.

"An adviser to Mr. Trump, Mr. Paulson, who is best known for making a $15 billion wager that the housing market would collapse, has managed some money for the president-elect."

From NY Times

"The day after Mr. Trump formally selected him, Mr. Mnuchin said that the government should get out of the business of running Fannie Mae and Freddie Mac, the two giant mortgage finance firms that the federal government bailed out in 2008. The shares of the two companies soared in response to his words — some of the sharpest one-day gains for the stocks since the government conservatorship began."

From Bloomberg

"Mr. Mnuchin’s remark may have benefited someone else: Mr. Trump has invested $3 million to $15 million with Mr. Paulson’s hedge fund, according to the financial disclosure statement filed during his run for president.

Assessments

 — The New York Times

 Sorkin discusses Mnuchin's status as public policy outsider: 

"But anyone looking for hints about Mr. Mnuchin’s ideology may be disappointed: His friends say he is not ideological and that, if anything, his ideology is simply his ambition.

Max Abelson and Zachary Mider — Bloomberg

Their article points to Mnuchin's goals:

"When Mr. Mnuchin decided to back Mr. Trump — much to the horror of some of his friends and peers — he explained it to Bloomberg Businessweek the way a trader would: 'Nobody’s going to be like, ‘Well, why did he do this?’ if I end up in the administration.'"


"Richard LeFrak, a billionaire developer who’s friendly with Mnuchin and has known Trump for about half a century, says he isn’t sure if the two even have the same ideology. But he sees a through line in Mnuchin’s journey from Wall Street to Hollywood to bank ownership to politics. “He’s a guy that can recognize an opportunity and adapt to it,” he says. “He’s able to switch into different things.”

Ally Marotti — Los Angeles Times

Marotti points out the discrepancy between Trump's populist message and his selection of Mnuchin:

"His deep roots on Wall Street fit the mold of past Treasury secretaries — though he never led a large investment bank — but they contrast with the populist stance the president-elect took during his campaign."

Peter Dreier — The Nation

 Dreier examines Mnuchin's deep roots in Wall St. and Goldman Sachs:

"Both Trump and Mnuchin earned their first fortunes the old fashion way: they inherited it. Trump took over his father Fred’s real estate empire and expanded it through questionable business practices. Mnuchin, also the scion of a wealthy and well-connected family, graduated from Yale in 1985 and soon wound up working at Goldman Sachs, where his father Robert had been a general partner."

Sam Levin — The Guardian

 Levin interviews victims of OneWest foreclosure practices including Bill Montes-Pack's:

“Rather than shaking up Wall Street, he installs the very person that was part of the financial mess,” said Montes-Pack, who has effectively been homeless since the foreclosure. “I’m just thoroughly disgusted.”

GOP — Mnuchin Website

 GOP website on Mnuchin