Political News

Democrats have a new favorite target: Steven Mnuchin

Posted January 29, 2019 10:04 p.m. EST

— Treasury Secretary Steven Mnuchin is facing intensifying pressure by congressional Democrats to provide more details over the Trump administration's decision to remove sanctions on three Russian firms tied to billionaire oligarch Oleg Deripaska.

Lawmakers from both chambers sent four separate letters to Mnuchin on Tuesday requesting further details on the Treasury Department's decision to rescind sanctions on Rusal, the world's second-largest aluminum producer, as well as EN+ Group and JSC EuroSibEnergo. The letters asked for details on possible conflicts of interest.

Rep. Elijah Cummings of Maryland, the chairman of the House Oversight and Reform Committee, and Sen. Ron Wyden of Oregon, the top Democrat on the Senate Finance Committee, wrote to Mnuchin citing press reports asking how he managed his own potential personal and professional conflicts of interest with a major Rusal shareholder, Len Blavatnik.

A second letter from California Democrat Rep. Jackie Speier also called into question how their relationship may have influenced the deal.

In a tweet responding to the Speier letter, Tony Sayegh, assistant secretary for public affairs at the US Treasury, said her "concerns are premised on false information. As our response to her letter will make clear, @stevenmnuchin1 had no direct business relationship with Mr. Blavatnik and any suggestion of a conflict of interest is baseless."

A Treasury spokesperson said they have received the letters and are reviewing them.

Earlier in the afternoon, the Democratic chairs of the House Financial Services, Intelligence and Foreign Affairs committees also sent a joint letter to Mnuchin, asking for a detailed accounting of the decision, noting "the terms of removal are unusual and many questions remain unanswered."

"For these reasons, the committees are interested in the process that led to the December 19th announcement to delist," the letter stated signed by Reps. Maxine Waters, Rep. Adam Schiff and Rep. Eliot Engel.

Democrats have criticized the deal, arguing in their letter that Deripaska still retains "significant influence, if not de facto control, over En+, Rusal and ESE" through his associates and family members.

The letters to Mnuchin comes less then two weeks after a hostile meeting with House Democrats on Capitol Hill, with Speaker Nancy Pelosi describing a classified briefing on the plan to relax Russian sanctions as a "waste of time."

Treasury initially notified Congress in December of its intent to lift the sanctions on the firms after months of negotiations to significantly reduce Deripaska's stake in the companies and after the firms agreed to make "significant restructuring and corporate governance changes."

Senate Democrats tried earlier this month to reverse the Trump administration's decision to lift sanctions on the firms utilizing a provision a 2017 Russia sanctions law, but failed to win the 60 votes needed.

Sanctions on the three Russian firms were officially relaxed over the weekend, according to an official government notice.

One letter to Mnuchin, Democratic Sen. Mark Warner of Virginia, the vice chairman of the Senate Select Committee on Intelligence, also requested regular briefings from the Trump administration on any reviews performed so that Congress can continue its oversight of the sanctions imposed on Deripaska and his companies.

"These recent reports strengthen my determination that the agreement Treasury has struck with Deripaska needs to be overseen strictly not only by OFAC but also by Congress," wrote Warner, referring to holdings by family members and close associates of Deripaska -- including his personal foundation, his ex-wife, her father and a firm with links to her family, which combined would amount to a nearly 57% stake of equity in En+.

"The combination of a nearly 57% equity stake and the ability to vote 35% of EN+ shares suggests that Deripaska and his close associates will continue to have the largest stake -- by far -- in EN+," wrote Warner.