Steve Mnuchin and Joseph Otting, the only two CEOs in the short and ignominious history of OneWest Bank, both testified before Congress on Thursday. Mnuchin, already installed as Treasury secretary, answered questions at the House Financial Services Committee. Otting, who is seeking to become head of the Office of the Comptroller of the Currency, one of the most important banking regulators, testified at the Senate Banking Committee.
Both of them lied under oath.
We shouldn’t get numb to that. We shouldn’t become bored with displays of perjury and false statements to Congress, offenses punishable with prison time, according to the United States code. If nobody in the Trump administration bothers to enforce the law, we should do our best to enforce it ourselves in the court of public opinion. For whatever reason, Mnuchin and Otting are comfortable with officially being liars in public settings. And we should ask why that’s so.
In both cases, the lies in question concern OneWest, the properly labeled “foreclosure machine” that caused unnecessary ruin for an untold number of families after the great crash of 2008. I say “untold” because Otting and Mnuchin still refuse to supply basic records of how many families suffered foreclosure at their hands. Several senators asked for this information today without success. Senator Sherrod Brown said that he appealed to Mnuchin six separate times for these records and got no satisfactory response. Brown asked Otting the same question Thursday, and Otting said that the records were in the hands of CIT, which purchased OneWest in 2015, and added that he would “support” release of the data, but “I don’t feel it’s my position to request that information.”
As a mortgage servicer (handling day-to-day operations on loans), OneWest pushed borrowers into foreclosure with bait-and-switch tactics. It presented phony documents to courts as evidence for those evictions. It violated numerous foreclosure laws in California, to the extent that the office of the state attorney general’s consumer-law section wanted to prosecute the bank. In an industry of rogues, OneWest stood out.
But Otting, like Mnuchin before him, maintained that OneWest actually was a white knight, routinely coming to the rescue of homeowners. He touted the low error rate of an after-the-fact review of OneWest’s practices, conducted by reviewers handpicked by the bank under the bank’s own guidelines, and concluded “there’s a false narrative about the OneWest servicing operation.” Senator Brown replied, “It’s a false narrative to you, not to those that lost their homes.”