[Congressional Record (Bound Edition), Volume 163 (2017), Part 1]
[House]
[Pages 1417-1418]
[From the U.S. Government Publishing Office, www.gpo.gov]




            PRESIDENT TRUMP'S CABINET NOMINEE, STEVE MNUCHIN

  The SPEAKER pro tempore. The Chair recognizes the gentlewoman from 
Ohio (Ms. Kaptur) for 5 minutes.
  Ms. KAPTUR. Mr. Speaker, today I rise to place in the Record a very 
important story from The Columbus Dispatch newspaper. It focuses on 
Steve Mnuchin, President Trump's nominee to be Treasury Secretary, and 
it raises issues of deep concern.

              [From the Columbus Dispatch, Jan. 29, 2017]

 Trump Treasury Pick Mnuchin Misled Senate on Foreclosures, Ohio Cases 
                                  Show

                 (By Alan Johnson and Jill Riepenhoff)

       President Donald Trump's nominee for U.S. treasury 
     secretary was untruthful with the Senate during the 
     confirmation process, documents uncovered by The Dispatch 
     show.
       Steve Mnuchin, former chairman and chief executive officer 
     of OneWest Bank, known for its aggressive foreclosure 
     practices, flatly denied in testimony before the Senate 
     Finance Committee that OneWest used ``robo-signing'' on 
     mortgage documents.
       But records show the bank utilized the questionable 
     practice in Ohio.
       ``The guy is just lying. There's no other way to say it,'' 
     said Bill Faith, executive director of the Coalition on 
     Homelessness and Housing in Ohio.
       The revelation comes with the committee's vote on whether 
     to confirm Mnuchin's nomination, currently scheduled for 
     Monday night.
       Barney Keller of Jamestown Associates, who represents 
     Mnuchin, was asked to comment for this story but did not 
     respond before deadline. Jamestown Associates is a Washington 
     political consulting and advertising firm that represented 
     Trump in his campaign.
       ``Robo-signing'' is the informal term for when a mortgage 
     company employee signs hundreds of foreclosures, swearing 
     they have scrutinized the documents as required by law when 
     in fact they have not.
       ``OneWest Bank did not `robo-sign' documents,'' Mnuchin 
     wrote in response to questions from individual senators, 
     ``and as the only bank to successfully complete the 
     Independent Foreclosure Review required by federal banking 
     regulators to investigate allegations of `robo-signing,' I am 
     proud of our institution's extremely low error rate.''
       But a Dispatch analysis of nearly four dozen foreclosure 
     cases filed by OneWest in Franklin County in 2010 alone shows 
     that the company frequently used robo-signers. The vast 
     majority of the Columbus-area cases were signed by 11 
     different people in Travis County, Texas. Those employees 
     called themselves vice presidents, assistant vice presidents, 
     managers and assistant secretaries. In three local cases, a 
     judge dismissed OneWest foreclosure proceedings specifically 
     based on inaccurate robo-signings.
       The Dispatch found more than 1,900 OneWest foreclosures in 
     the state's six largest counties from 2009 to 2015.
       Carla Duncan, a social worker from Cleveland Heights, was 
     snared by OneWest's robo-signing machinery.
       On her way out of town for a short trip in 2010, Duncan 
     stopped by her home to get her mail and found a note from a 
     field inspector for her mortgage company saying that her 
     house was vacant and was going to be boarded up.
       ``It wasn't vacant. I was living there,'' Duncan said. 
     ``There were curtains on the windows. The radio was playing 
     and the dog was there.''
       What Duncan didn't know at the time was that OneWest had 
     begun foreclosure proceedings on her three-bedroom home even 
     though she was up-to-date on her payments. OneWest refused to 
     accept a loan modification approved by a previous lender that 
     had been purchased by OneWest, and it wanted to substantially 
     increase Duncan's interest rate and monthly payment and add 
     late fees. The company also put a lock box on a separate 
     rental property she owned in Cleveland.
       After hiring former Ohio Attorney General Marc Dann, waging 
     a five-year court battle and filing personal bankruptcy, 
     Duncan was finally able to get the foreclosures dismissed and 
     keep her home and rental property. She said the experience 
     was devastating.
       ``It's almost like being raped, like being emotionally 
     violated,'' Duncan said. ``It got to the point that I was 
     afraid to open my own door.''
       Court records show that Duncan's mortgage was robo-signed 
     by Erica Johnson-Seck, vice president of OneWest's department 
     of bankruptcy and foreclosures. From her office in Austin, 
     Texas, Johnson-Seck robo-signed an average of 750 foreclosure 
     documents a week, according to a sworn deposition she gave in 
     a Florida case in July 2009.
       Under oath, Johnson-Seck acknowledged that she did not read 
     the documents she was signing, taking only about 30 seconds 
     to sign her name. To speed up the process, Johnson-Seck said 
     she shortened her first name on her signature to just an 
     ``E.'' She said in the deposition that OneWest's practice was 
     to review just 10 percent of the foreclosure documents for 
     accuracy.
       Dann, who now specializes in representing clients who have 
     problems with banks and other lenders after he was forced to 
     resign as attorney general nearly 10 years ago, said 
     Mnuchin's businesses were a ``major offender'' in problem 
     mortgages. Dann said Mnuchin's firms were known for dual 
     tracking (pursuing foreclosures simultaneously as they 
     allegedly worked with homeowners), fabricating documents and 
     other tactics ``that caused unbelievable devastation in 
     people's lives.''
       In 2010, federal laws were changed, enabling borrowers 
     victimized by lenders to sue them. Dann said he worries that 
     Mnuchin, as treasury secretary, would quietly work to repeal 
     reforms, collectively known as the Dodd-Frank Wall Street 
     Reform and Consumer Protection Act.
       That appears to be the case.
       ``It has been over six years since the passage of Dodd-
     Frank and it seems like an appropriate time to review all of 
     the regulations from Dodd-Frank to understand their impact on 
     the market, investors, small businesses and economic 
     growth,'' Mnuchin said in a written answer to the Senate.
       U.S. Sen. Sherrod Brown, D-Ohio, grilled Mnuchin at his 
     recent hearing and in follow-up written questions.
       ``Mnuchin profited off of kicking people out of their homes 
     and then gave false testimony about his bank's abusive 
     practices,'' Brown told The Dispatch. ``He cannot be trusted 
     to make decisions about policies as personal to working 
     Ohioans as their taxes and retirement.''
       Faith, the homelessness coalition director, said 
     foreclosure practices by Mnuchin's companies and others like 
     them ``created havoc.''
       ``People were bamboozled into signing these mortgages,'' 
     Faith said. ``We watched this train wreck happen. It's been 
     devastating, not only to the people who got caught in this 
     kind of scheme, but also to people who happened to live in 
     the neighborhood . . . . It's scary that he's going to be 
     treasury secretary.''
       The Dispatch analysis showed thousands of Ohio homeowners--
     including 245 in Franklin County--found themselves in 
     OneWest's crosshairs when they defaulted on their loans, the 
     majority of them with high interest rates. Many mortgages had 
     terms that housing and financial experts view as predatory: 
     prepayment penalties, interest-only loans and no-money-down 
     loans.
       In addition to OneWest, which was born in 2009 from the 
     collapse of subprime mortgage giant IndyMac, Mnuchin's 
     banking group also acquired Financial Freedom, a subsidiary 
     of Lehman Brothers that went bankrupt because of its toxic 
     mortgage portfolio. The firm specialized in loans to senior 
     citizens cashing in on their homes' equity.
       Mnuchin was labeled by critics at the time as the 
     ``Foreclosure King.''
       Of the nearly four dozen foreclosure cases filed by OneWest 
     in Franklin County in 2010 that were analyzed by The 
     Dispatch, a quarter were filed within three years of the 
     homeowner taking out the loan, typically a red flag that 
     there was a problem with the mortgage terms and/or vetting 
     the borrowers.
       Thirteen of the borrowers had double-digit interest rates, 
     ranging from 10 percent to 17.31 percent, largely because of 
     adjustable-rate mortgage terms.
       In the cases in which the houses were sold at an auction, 
     two-thirds ended up in the hands of the federal government, 
     which had backed those loans. Collectively, more than $4 
     million was due on those loans.
       Only seven borrowers were able to get a loan modification, 
     even though former President Barack Obama's administration 
     had been pushing since 2009 for lenders to help Americans 
     keep their homes by lowering interest rates and, in some 
     cases, the principal balance.
       Mnuchin does have supporters, including the American 
     Bankers Association, which sent a letter to the Senate 
     committee saying Mnuchin's ``public statements as well as his 
     career in finance bring us optimism with regard to the 
     outlook for public policies focused on growth and 
     prosperity.''
       Grover Norquist, head of Americans for Tax Reform, released 
     a statement supporting Mnuchin's nomination, in part because 
     of his stated intention to roll back some of the Dodd-Frank 
     legislation: ``Mr. Mnuchin has made it clear that reforming 
     the Dodd-Frank Act will be his `number one priority on the 
     regulatory side' once he becomes secretary of the treasury.''

  Ms. KAPTUR. According to The Columbus Dispatch, Mnuchin was 
untruthful to the Senate Finance Committee regarding his company's 
aggressive role in hastening thousands of home foreclosures during the 
2000 financial crisis and what followed, and his misdeeds deeply 
impacted places like Ohio.
  Mr. Mnuchin was the chief executive officer of OneWest Bank, which 
engaged in so-called robo-signing of mortgage documents. That means you 
really don't--you treat people like objects; you really don't go into 
the details of every case.
  The Columbus Dispatch said its analysis of dozens of foreclosure 
cases in

[[Page 1418]]

Ohio, and subsequent action, prove otherwise.
  The dastardly practice of robo-signing, prevalent throughout the 
mortgage industry in the aftermath of that terrible financial crisis, 
had certain leaders, of which Mr. Mnuchin was at the top of the heap; 
and their employees signed foreclosure documents en masse without 
properly reviewing them and forcing unjust foreclosures.
  The Columbus Dispatch found more than 1,900 such cases in Ohio alone. 
Individual cases revealed OneWest Bank declared properties vacant, even 
though someone was living in them. OneWest Bank, time and again, 
refused to abide by agreed-upon loan modifications.
  Is that the kind of person that we really want in charge of the U.S. 
Treasury Department?
  Nominee Mnuchin comes with a Goldman Sachs pedigree. Well, wouldn't 
we know that? He was nicknamed the ``foreclosure king'' after buying up 
IndyMac, a subprime lender that evicted about 36,000 people during the 
financial crisis.
  Sadly, Mr. Speaker, while President-elect Trump promised to drain the 
swamp, his nominee for Treasury Secretary proves he is not doing that 
at all. He is enlarging the swamp.
  The Columbus Dispatch found more than 1,900, I repeat, OneWest Bank 
foreclosures in our State's six largest counties from 2009 to 2015.
  In addition, Mr. Mnuchin profited personally off of kicking people 
out of their homes. Does such a person actually deserve confirmation as 
Secretary of the Treasury of the United States of America?
  Wake up, America. Wake up. Pay attention to what is happening here in 
Washington, D.C. This city belongs to you. This Capitol belongs to you.
  Mr. Speaker, I would also like to place in the Record a release I 
sent out over the weekend relating to President Trump's executive order 
on immigration and refugees.

 Kaptur Statement on President Trump's Executive Order on Immigration 
                              and Refugees


  Condemns misguided mandate, invites Trump to meet with refugees who 
                             call Ohio home

       Washington, DC.--Today Congresswoman Marcy Kaptur (OH-09) 
     released the following statement in light of confusion and 
     hurt emanating from President Donald Trump's Executive Order 
     on immigration and refugees.
       ``In New York harbor, not far from President Donald Trump's 
     office tower stands the awesome Statue of Liberty with Emma 
     Lazarus' immortal words, `Give me your tired, your poor, your 
     huddled masses yearning to breathe free.' Surely, President 
     Trump has read these words.
       ``Ancesters of the Trump and Kaptur families both passed 
     through that unforgettable portal as they made their way to 
     America as immigrants. How can we deny to others the gift of 
     freedom bequeathed to us?
       ``I support robust efforts to make America safe and secure. 
     But a workable solution should ensure America's safety 
     without destroying our heritage as an immigrant nation, 
     dedicated to liberty and justice for all.
       ``President Trump's mandate will make America less safe. It 
     penalizes worthy individuals and actually gives terrorist 
     cells ammunition to use against America. This mandate puts 
     people at risk who have helped America in our battle against 
     terrorism, at home and abroad. It punishes innocent 
     individuals caught in the crossfire fleeing terror and tribal 
     conflict.
       ``Dangerously this misconceived Executive Order will spur 
     anti-American sentiment globally and on the Internet, 
     spurring more terrorism, including against our troops, and it 
     potentially aggravating religious conflict half way around 
     the world. Reckless rhetoric puts our nation at greater risk 
     at home and puts Americans traveling abroad in danger.
       ``I cordially invite the President to northern Ohio to meet 
     personally with some of the crossfire fleeing the terror of 
     war and tribal conflict. A well-crafted policy should 
     enshrine liberty for all law-abiding persons while avoiding 
     unintended consequences that can be used by our enemies to 
     enflame terrorism.''

  Ms. KAPTUR. I just wish to say that the ancestors of the Trump 
family, as well as the Kaptur family, passed through the unforgettable 
portal of the Statue of Liberty in New York Harbor. And the words at 
the base of that statue are emblazoned in the minds of families like 
our own going back generations. ``Give me your tired, your poor, your 
huddled masses yearning to breathe free.'' Surely, President Trump has 
read these words.
  I support robust efforts to make America safe and secure, and have 
served on all the committees in this Congress that aim to do that. But 
workable solutions should ensure America's safety, without destroying 
our heritage as an immigrant Nation dedicated to liberty and justice 
for all.
  President Trump's mandate actually will make America less safe 
because it penalizes worthy individuals and puts them at greater risk, 
and it actually gives terrorist cells ammunition to use against 
America.

                              {time}  1100

  Think about it. This mandate puts people at risk who helped America 
in our battle against terrorism abroad and at home, and it punishes 
innocent individuals caught in the crossfire fleeing terror and tribal 
conflict.
  Dangerously, this misconceived executive order will spur anti-
American sentiment globally and on the internet spurring more 
terrorism. The old World War II motto ``loose lips sink ships'' is 
going to happen because of the way this was conducted. Reckless 
rhetoric puts our Nation at greater risk at home and puts Americans 
fighting for us and those traveling abroad in greater danger.
  Mr. Speaker, I cordially invite the President to northern Ohio. Come 
and meet some of the people whose lives your order changed. I think you 
will change your mind.
  The SPEAKER pro tempore. Members are reminded to address their 
remarks to the Chair.

                          ____________________