California’s attorney general “uncovered evidence suggestive of widespread misconduct” at OneWest, the bank run by President-elect Donald Trump’s pick for Treasury secretary, Steve Mnuchin — but never brought a suit against the company, according to a report.
OneWest, which Mnuchin controlled from 2009 to 2015, has been the target of housing advocates for foreclosing on as many as 36,000 homes in California in the wake of the financial crisis.
The California investigation, which hasn’t been previously disclosed, claims that OneWest pushed people out of their homes by backdating hundreds of documents and gaming auctions, and “performed acts in the foreclosure process without valid legal authority,” according to a draft civil suit obtained by The Intercept.
The bank even backdated documents “years, months, and weeks before OneWest actually began operations,” according to the draft suit.
Investigators at the California AG’s consumer law section also claim they were “hampered” since they couldn’t subpoena the bank and OneWest was causing “obstruction” of a related investigation, according to a related 2012 memo posted by The Intercept.
The state was also reluctant to investigate third parties because it anticipated OneWest would seek relief from investigation by a court, the memo said.
In 2013, the state investigators recommended that Kamala Harris — then the attorney general — bring a suit against the bank, but a suit was never filed.
It’s unclear why Harris’ office declined to file the suit.
“State attorneys general have no jurisdiction to investigate federally chartered banks like OneWest,” Mnuchin spokeswoman Tara Bradshaw told The Intercept. “When OneWest pointed that out to the California attorney general’s office, they withdrew their subpoena.”
In 2010, OneWest gave $13,000 to Harris’ first campaign for AG, according to the Sacramento Bee. Last year, Mnuchin donated $2,000 to the AG’s campaign, according to Federal Election Commission data.
A spokeswoman for Harris’ office didn’t return a request for comment.