Courtesy of Pam Martens.
Jack Lew Testifying at His Confirmation Hearing, February 13, 2013
For the past two days, some of the priciest media real estate in America has been obsessing over the new signature that Jack Lew, the U.S. Treasury Secretary, is sporting on the nation’s currency. No less than the Washington Post, Los Angeles Times, New York Daily News, CBS News and numerous other media outlets devoted space to this trivia about Lew’s squiggly signature getting a makeover.
While this non-story was playing out, AlterNet and Wall Street On Parade co-published an investigation of New York University, where Lew served as Executive Vice President and Chief Operating Officer from 2001 to June of 2006. The New York Times printed a similar investigation on its front page yesterday.
Both investigations showed that in addition to questionable mortgage financing of primary residences for faculty, NYU was financing lavish vacation homes for both administrators and faculty. In some cases, it was forgiving those loans as well as repaying the recipient for interest charged on the loans.
A mortgage that is forgiven is not a loan – it’s income. Interest recompensed on a loan is not interest – it’s income. A below-market interest rate on a mortgage loan is also income. Whether all of this income was reported to the IRS is an open question. Having Jack Lew sitting at the helm of the U.S. Treasury, which oversees the IRS, does not instill confidence among the citizenry because Jack Lew, himself, got one such mortgage loan while employed at NYU for a primary residence in Riverdale, New York.
A question of equally great moment is what did Jack Lew know about the vacation homes being lavished on administrators and faculty at the time he was Chief Operating Officer of NYU. John Sexton, the President of NYU, signed off on Jack Lew’s loan – was it hush money to keep Lew from questioning all those other mortgage deals? As Chief Operating Officer, how could Lew not have known about the funny money mortgages?
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