Joseph Otting, right, then chief executive of OneWest Bank, speaks at a 2015 hearing in Los Angeles, regarding the bank’s purchase by CIT Group. (Al Seib / Los Angeles Times)
President Trump intends to nominate Joseph Otting, the former chief executive of Pasadena’s OneWest Bank and an ally of Treasury Secretary Steven Mnuchin, to a key financial regulatory position.
Otting is being tapped to be the comptroller of the currency, a powerful regulator who oversees federally chartered banks, the White House announced Monday night.
Those include the banking arms of some of the largest financial institutions in the country, including JP Morgan Chase & Co. and and Wells Fargo & Co.
The Office of the Comptroller of the Currency, which is an independent bureau of the Treasury Department, was a pivotal player in the $185-million settlement last year with Wells Fargo involving its creation of unauthorized accounts.
Otting would replace Keith Noreika, a banking industry lawyer whom Trump appointed last month as acting comptroller of the currency to replace Thomas Curry after his five-year term expired.
The nomination of Otting, who will need Senate confirmation, is likely to revive Democratic criticisms of Mnuchin regarding the practices of OneWest Bank.
In 2009, Mnuchin led a group of investors who put up about $1.6 billion to buy the failed IndyMac bank, a leading subprime mortgage lender, and renamed it OneWest.
Mnuchin served as the bank’s chairman from 2009-15 and Democrats accused the bank of being “a foreclosure machine” that helped him profit from the 2008 financial crisis that left many homeowners unable to make their mortgage payments.
The bank was sold to CIT Group in 2015 for $3.4 billion
Mnuchin denied the allegations, saying the bank was trying to deal with IndyMac’s poor mortgage portfolio.
Otting was OneWest chief executive from 2010 to 2015. Before that, he had worked as en executive for US Bancorp.