President-elect Donald Trump’s nominee for Treasury secretary, Steve Mnuchin, plans to divest his interests in 43 companies and investments to avoid conflicts, following recent concerns from Democrats on his background in Wall Street, according to an article in Bloomberg by Saleha Mohsin. And one of these companies holds a stake in Fannie Mae and Freddie Mac.
The article stated that a disclosure report and ethics agreement released Wednesday by the U.S. Office of Government Ethics reports a range of values for Mnuchin’s assets: $118.2 million to roughly $391.6 million. This includes more than $50 million in CIT Group Inc.
However, the article noted that the range is limited by the fact that Mnuchin disclosed only minimum values for some of his stakes -- including his common shares in CIT. His net worth estimate is $620 million, according to the Bloomberg Billionaires Index.
In the ethics letter, Mnuchin said, “The purpose of this letter is to describe the steps that I will take to avoid any actual or apparent conflict of interest in the event that I am confirmed for the position of Secretary of the Treasury.
Mnuchin is a former executive at Goldman Sachs and former chairman of OneWest Bank, a background that’s proved already to be very controversial.
One of the biggest areas of concern revealed in the announcement is Mnuchin’s stake in Fannie and Freddie.
Shortly after being nominated, Mnuchin dropped a bombshell about the future of Fannie Mae and Freddie Mac.
Rather than be wound down, as some including another rumored choice to lead the Treasury, Rep. Jeb Hensarling, advocate for, Mnuchin said the government-sponsored enterprises will be taken out of “government ownership,” restructured, and privatized.
As a result, Mnuchin sent the stocks of Fannie Mae and Freddie Mac soaring to heights not seen since June 2014.
Now, according to the Bloomberg piece, Mnuchin’s filings show he’s invested as much as $2 million in Paulson Advantage LP, which holds a stake in Fannie and Freddie.
However, the article added that Paulson Advantage holdings are among 43 investments that he has pledged to divest within 90 days of being confirmed.