WASHINGTON — President Trump has nominated Joseph Otting, who previously ran California-based OneWest, to be Comptroller of the Currency. In a twist, Otting was once on the receiving end of a fine from a federal regulator.
The Comptroller oversees many of the nation’s biggest banks, including those on Wall Street. Otting is a close ally of Treasury Secretary Steven Mnuchin, both of whom worked together at OneWest, the bank formerly known as IndyMac that was taken over by the federal government in 2008 and sold to a group of investors. Otting was CEO from 2010 to 2015, when the bank was sold for $3.4-billion to CIT Group, after which he departed. Otting also previously served as vice chairman of U.S. Bank.
While he was leading OneWest, the bank was criticized over its foreclosure practices and tactics such as using “robo-signing” on mortgages. A OneWest subsidiary, Freedom Financial, paid $89 million in fines to the Justice Department over practices related to reverse mortgages.
“The president’s choice for watchdog of America’s largest banks is someone who signed a consent order — over shady foreclosure practices — with the very agency he’s been selected to run,” said Sen. Sherrod Brown (D-OH), in a statement. Brown’s reference was to a 2011 consent decree between OneWest and the Office of Thrift Supervision, which is now part of the Comptroller’s Office that Otting has been nominated to lead.
“If Mr. Otting didn’t deal fairly with the customers at his own bank, it’s difficult to see why he’s the best choice to look out for the interests of customers at more than 1,400 banks and thrifts across the country,” added Brown, who is a member of the Senate Banking Committee.