It looks like Donald Trump has made his pick.
After much back and forth over who would be appointed the role of Treasury Secretary, it looks like Steve Mnuchin could get the job as early as Wednesday, the New York Times reports.
Mnuchin is likely to be a controversial pick, however, who doesn’t sit well with voters who backed Trump’s anti-Wall Street campaign rhetoric.
He is a former Goldman Sachs mortgage bond trader who has worked or entered into deals with hedge fund managers like George Soros, Eddie Lampert and John Paulson.
He then led a deal to buy up IndyMac, a failed bank, in the depths of the financial crisis, likely making a huge amount of money in the years that followed. During his tenure at the top of the bank, it faced a consent order over its foreclosure process, and more recently the bank has been accused of discriminating against Blacks, Hispanics and Asians.
Here’s some highlights from Mnuchin’s career:
- Mnuchin spent 17 years with Goldman Sachs, and his father worked at the bank for 30 years in stock trading.
- He was head of the mortage department in the early days of collateralized debt obligations and credit default swaps, instruments that many have argued had a part to play in the financial crisis.
- In that role, he worked for Goldman Sachs’ current CEO Lloyd Blankfein, who at the time was head of fixed income. Blankfein said earlier this month that Mnuchin a “high flier,” “a very nice guy,” and a “smart, smart guy.”
- He left Goldman to join Eddie Lampert’s hedge fund ESL Investments. Lampert had been a roommate at Yale. Lampert is now the CEO of retailer Sears. You can read about how that has played out here.
- He then set up an investment fund with George Soros.
- Blankfein and Soros were both featured in a pre-election campaign ad for Trump that took aim at a “global power structure” that had “robbed our working class, stripped our country of its wealth, and put that money into the pockets of a handful of large corporations and political entities.”
- During the depths of the financial crisis in 2009, a group led by Mnuchin bought the troubled housing lender IndyMac. The buyer group included Soros, hedge fund billionaire John Paulson, former Goldman Sachs executive Chris Flowers, and tech billionaire Michael Dell. After renaming the company OneWest, Mnuchin served as chairman until selling it to CIT Group in 2015.
- In 2011, the Office of Thrift Supervision issued a consent order against the bank after a review. Mnuchin was chairman at the time. “The review uncovered unsafe and unsound practices, violations of law and foreclosure processes geared toward speed and quantity, instead of quality and accuracy,” according to a statement at the time.
- Two California housing watchdogs have filed a federal complaint accusing OneWest of violating the Fair Housing Act by discriminating against Blacks, Hispanics and Asians. According to the complaint, market share and regulatory data shows that “since at least 2011, respondent made few loans to Asian American, African American and Latino borrowers and communities in absolute terms, in relation to the demographics of the counties in respondent’s CRA assessment area, and/or in relation to the industry as a whole.”
- Mnuchin oversaw OneWest until it sold to CIT for $3.4 billion, more than double the $1.55 billion the buyer group paid. The owners also took out $1.9 billion in dividend payments from the bank, according to the LA Times. Mnuchin stayed on and took a seat on the board of CIT, which is valued at around $7.9 billion.
Mnuchin, if he does get selected by Trump, will have to go through confirmation hearings with the Senate Finance Committee. It’s likely to be an interesting process.
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