Treasury Secretary Scott Bessent once agreed to call two different houses his “principal residence” at the same time — a similar claim to the one that President Donald Trump cited when he tried to fire Federal Reserve Governor Lisa Cook, according to a report Wednesday.
Documents show that on the same day in September 2007, Bessent agreed that homes in both Bedford Hills, New York, and Provincetown, Massachusetts, each would be his principal residence, Bloomberg reported.
Cook signed mortgage agreements declaring that houses in Ann Arbor, Michigan, and Atlanta were each her principal residences, according to prior reports. Cook signed those documents within two weeks of each other in summer 2021, before she was appointed to the Fed’s board.
Federal Housing Finance Agency Director Bill Pulte has repeatedly accused Cook of mortgage fraud after posting her mortgage documents on social media in August.
The Justice Department opened an investigation of Cook after receiving a criminal referral from Pulte dated Aug. 15, which claimed she falsified her residency status at the two properties, potentially to secure more favorable interest rates and loan terms.
Trump said on Aug. 25 that he was firing Cook based on Pulte’s allegations. Cook, who has sued to block her removal, has denied committing mortgage fraud.
A U.S. District Court judge in Washington, D.C., and a federal appeals court have ruled that Trump cannot fire Cook while her suit continues.
Trump’s effort to remove Cook came after he unsuccessfully pressured the Fed for months to slash interest rates.
Bessent, in an interview in August with Fox Business Network, was asked about Cook’s situation.
“There are people who think that President Trump is putting undue pressure on the Fed,” Bessent said.
“And there are people like President Trump and myself who think that if a Fed official committed mortgage fraud, that this should be examined, and that they shouldn’t be serving as one of the nation’s leading financial regulators.”
Bank of America, the mortgage lender for the two Bessent properties, in a letter to the Treasury secretary sent in the past several weeks said that it was aware that both his Bedford Hills and Provincetown properties were “secondary residences.”
“As your bankers, we were well aware that your primary residence” was in Manhattan, a managing director for the bank said in the letter to Bessent.
“Regardless, for the mortgage product you received, interest rates do not vary based on utilization as a primary versus secondary residence and neither mortgage was backed by or sold to any Government Sponsored Entity or other investor.”
Rider documents associated with the mortgage agreements also show the Bedford and Provincetown houses referenced as secondary residences.
Alex Spiro, Bessent’s personal attorney, blasted Bloomberg’s report.
Mortgage experts told Bloomberg there was no sign of wrongdoing by Bessent, and one of them said that neither his case nor Cook’s appeared to indicate fraud because both borrowers’ plans for their properties had been disclosed to the lender.
“Nearly 20 years ago, Mr. Bessent’s lawyers filled out paperwork properly, the bank has confirmed it was done properly, and this nonsensical article reaches the conclusion that this was all done properly,” Spiro said in a statement to CNBC.
The Treasury Department declined to comment on the article.
Bloomberg’s report noted that Cook’s and Bessent’s situations are not identical.
Cook had personally signed her mortgage agreements, while Bessent’s were signed on his behalf by a lawyer.
And both of Bessent’s mortgages were with the same lender, Bank of America, while Cook’s were with two different banks.
However, there is evidence that lenders were aware of Cook’s actual plans for the respective properties, just as Bank of America said it knew of Bessent’s intentions.
Reuters reported last week that a May 2021 loan estimate indicates that Cook had called the Atlanta property a “vacation home.”
Charles Rich, the lawyer who represented Bessent in the 2007 mortgage agreements, gave a statement to CNBC.
“I was Mr. Bessent’s attorney and agent under a Power of Attorney made in September 2007 when I signed a mortgage to finance the purchase of a new residence for Mr. Bessent in Bedford Hills, New York under a mortgage loan,” Rich said.
“Concurrently with the 2007 closing, I executed a second mortgage on a property located in Provincetown, MA as additional collateral,” he said.
“Bank of America was fully aware that the Provincetown, MA property was not a principal residence and waived any requirement that it be used as a principal residence,” Rich said.
“There was absolutely nothing improper about Mr. Bessent’s loan applications with which he was minimally involved as he had delegated authority to me as his lawyer and an agent to close these loan transactions,” he said.
