California senator failed to go after Mnuchin’s OneWest, but secured a major settlement from big banks for mortgage-servicing violationsTRD NATIONAL /August 11, 2020 07:00 PM By Georgia Kromrei
Kamala Harris and Joe Biden (Getty)
While serving as California attorney general, Kamala Harris could have gone after Steve Mnuchin for alleged mortgage fraud at his company, OneWest, but didn’t.
OneWest foreclosed on more than 36,000 California homeowners in the years following the Great Recession. Harris’ office conducted a preliminary investigation, and deputy attorneys general recommended the state take action, but no charges were brought.
On other occasions, however, Harris, who was just named by Democratic presidential nominee Joe Biden as his pick for vice president, has taken the battle to the industry.
In 2012, she negotiated the second-largest civil settlement in U.S. history for predatory practices that contributed to the foreclosure crisis, securing $25 billion for homeowners from the country’s biggest lenders, including Bank of America, Wells Fargo, JPMorgan Chase and Citigroup. Though the banks had agreed upon a far lower amount with the Obama administration and other states, Harris played hardball, walking away from the table until the banks agreed to cough up billions of dollars more.ADVERTISEMENT
Harris is the first African-American female vice presidential candidate — in a year when longstanding racial tensions have roiled communities. The police killing of George Floyd unleashed a public outcry and nationwide protests against police brutality. The haphazard federal response to the Covid-19 crisis has also given more force to criticism of President Donald Trump, whose Wall Street donors have mostly abandoned him in favor of Biden.
James Whelan, president of the Real Estate Board of New York, called Harris’ nomination an “exciting moment” that will impact generations to come.
“In a country as diverse as ours, we must continue to make strides like these to include a broader spectrum of voices in every industry and every institution, including the highest office in the land,” he said in a statement.
A lot has happened since Harris threw her hat in the ring for the Democratic presidential nomination. She officially withdrew her candidacy on December 3, 2019, and endorsed Biden three months later.ADVERTISEMENT
Her presidential platform, however, included points that may not sit well with real estate interests, including her position that “housing is a human right.” In November 2019, she and Rep. Maxine Waters introduced a bill that would invest more than $100 billion in affordable housing, including $10 billion to ease or eliminate zoning requirements.
Harris said she would pass legislation to provide a tax credit for renters spending over 30 percent of their income on rent and utilities, the level at which tenants are considered to be rent-burdened. She also supported a federal minimum wage of $15, which developers have said would drive up their construction costs.
Last year, she also teamed up with Rep. Alexandria Ocasio-Cortez – the subject of intense criticism from many in the real estate community – to eliminate the “one-strike rule” in public housing, a Clinton-era policy allowing residents to be evicted for violent or drug-related crimes. The legislation aimed to prohibit public housing authorities from denying someone housing if they had a criminal record.ADVERTISEMENT
Harris has challenged Trump’s tax cuts, calling them a “trillion-dollar tax scam” and said that she would reverse his 2017 corporate tax cut. And she joined 37 of her Democratic colleagues last year to argue against a capital gains tax cut, calling it an “illegal action that would defy longstanding Justice Department policy.”
(Biden has also called for a reform of the tax code, specifically going after real estate’s favorite tax loophole, the 1031 “like-kind” exchange. )
She has proposed additional taxes on the financial sector, calling for a new tax on banks with more than $50 billion in assets. Many of New York’s largest construction lenders would fall into that category.
But while she may take largely populist political stances, Harris’ personal taste, at least as real estate goes, runs more to the posh. She owns a 3,500-square-foot pad in the posh Brentwood neighborhood of Los Angeles. The property, as per a Forbes article citing Zillow estimates, is worth $4.8 million.