Donald Trump's nominee to head the Treasury Department says he "saved thousands of jobs" with a bold investment in an expensive, failing bank during the financial crisis. Steve Mnuchin made the claim Thursday at his confirmation hearing before the U.S. Senate Finance Committee.
Ranking Democrat Ron Wyden accused the nominee of cheating troubled borrowers with sloppy paperwork and questionable practices. The bank foreclosed thousands of mortgages, and Wyden said Mnuchin's bank "put more vulnerable people on the street faster than just about anybody else around."
Wyden criticized Mnuchin for moving money overseas to avoid taxes, and expressed doubts that the nominee would work on "behalf of all Americans." At a separate event, the senate's top Democrat Chuck Schumer said Mnuchin and other Trump nominees for top posts are "ethically challenged."
Mnuchin got rich by making many investments including in movies and a sub-prime mortgage lender IndyMac. The Wall Street Journal says the troubled bank had one of the worst portfolios in the business with more than nine percent of its loans at least two months behind.
Mnuchin told the committee that previous management, not his group, made poor loan decisions that pushed the bank into crisis. The nominee says he rebuilt the bank and saved jobs with a $1.6-billion investment when other investors "were running for the hills."
Mnuchin also said he would "have no problem" criticizing China for manipulating its currency. Some experts say Beijing artificially depresses the value of its own currency to give its products a price advantage on world markets. Washington says the practice hurts U.S. exports and jobs, but has previously refrained from publicly confronting China on the issue because it needs Beijing's cooperation on other issues.
Senate Finance Committee Chairman Orrin Hatch, a Republican, said Mnuchin is an "effective choice" to lead a department that should play a key role in getting America's economy "back on track." He also said Mnuchin has the skill and insight to help reform the tax code, promote investment and spur job creation.
Mnuchin said his first job was working in a glass factory during high school. He later studied economics at Yale University, worked at the Goldman Sachs financial firm, and eventually started his own financial company.
The Treasury Department is supposed to maintain a strong economy by promoting conditions that enable economic growth in the United States and elsewhere. Treasury has more than 100,000 employees who manage and protect the financial system.