Trump picks UNI grad to regulate Wall Street

Joseph Otting, a University of Northern Iowa graduate who grew up in Maquoketa and was a former lieutenant of Treasury Secretary Steven Mnuchin's at OneWest Bank, has been tapped to lead a U.S. regulator that oversees more than 1,000 lenders - including Wall Street giants.

President Donald Trump plans to nominate Otting to run the Office of the Comptroller of the Currency, the White House said in a statement Monday evening. If confirmed by the Senate, he will play a central role in trying to ease financial rules that the administration blames for stunting economic growth.

The appointment would mark a reversal in roles for Otting, as the OCC regulated OneWest when he was the bank's CEO.

The selection continues Trump's predilection for filling government jobs with former finance executives, even though he routinely criticized the industry on the campaign trail. Otting's confirmation would give Mnuchin a key ally in changing the regulatory tone in Washington, D.C., by dialing back aggressive scrutiny of banks.

The agency is being run by former bank lawyer Keith Noreika.

OneWest named Otting CEO in October 2010, with then-chairman Mnuchin praising his knowledge of the southern California market. After CIT Group Inc. acquired OneWest in 2014, Otting was co-president for a few months before being replaced.

Otting, who now lives in Nevada, probably will face the same kind of hammering from Senate Banking Committee Democrats over OneWest's business practices that Mnuchin endured during his conformation process. The bank, created after IndyMac's collapse during the 2008 financial crisis, seized properties from tens of thousands of homeowners, foreclosures that some Democrats have called unfair and improper.

As CEO, Otting arguably had more involvement in the company's day-to-day operations than Mnuchin did as chairman.

In 2011, OneWest was involved in an enforcement action in which the government ordered mortgage servicers to review whether their foreclosure practices were appropriate. It took four years - most of Otting's tenure - for the company to satisfy the concerns of the OCC and other banking regulators.

The White House described Otting as having 'a long career in financial services working for a number of highly regarded regional banks.” If he takes over the OCC, Otting will run an independent agency within the Treasury Department that supervises the banking units of major financial institutions including JPMorgan Chase, Citigroup and Bank of America. He also would become a member of the Federal Deposit Insurance Corp.'s board and the Financial Stability Oversight Council.

Otting, who holds a bachelor's degree from the UNI, would be the first comptroller in decades without an advanced degree, as the agency's most recent heads have all held law degrees.

His biographical information from the White House lists him as a graduate of the 'School of Credit and Financial Management at Dartmouth College,” which is a continuing-education program for financial executives that operated on the campus of the Ivy League institution, but isn't actually affiliated with it.