Warren, AOC, targets Treasury Secretary Steven Mnuchin following Sears bankruptcy

Candidate for the Presidency and Senator Elizabeth Warren, D-Mass. And Representative Alexandria Ocasio-Cortez, DN.Y. are targeting Treasury Secretary Steven Mnuchin, raising questions about his time on the Sears Holdings Board of Directors and his relationship with Eddie Lampert, former CEO of the troubled company.

Mnuchin, who was Lampert's roommate at Yale University, served on the Sears board of directors until December 2016, after the elected President, Donald Trump, was elected to the Board of Trustees. chose to be part of the new firm.

Under Lampert, who led Sears from 2013 to 2018, Sears closed more than 3,500 stores, sold some of its most valuable assets, including Lands & End, and laid off thousands. Sears filed for bankruptcy last October. Lampert purchased Sears through a member of its hedge fund, ESL Investments, to avoid total liquidation.

In a four-page letter sent Thursday morning, Warren and Ocasio-Cortez asked Mnuchin a series of questions about his advisory role in Lampert's decisions.

In a video on Twitter announcing the letter to Mnuchin, Ocasio-Cortez criticized the secretary for "a striking example of what happens when rich and powerful people put other rich and powerful people in power."

The workers "deserve a treasure secretary who is fighting for them," said Warren in the video, "not someone who has spent a decade making money for hundreds of thousands of dollars. Sears employees ".

The Treasury Department did not immediately respond to CNBC's request for comment on the letter from Warren and Ocasio-Cortez. ESL declined to comment.

The letter from Warren and Ocasio-Cortez, consumer advocates who are among the most liberal legislators in Congress, comes about a month after Sears launched a lawsuit against Lampert, Mnuchin and other former members of administration, alleging that they had stolen billions from the former titan of the party. US retail sector.

According to the lawsuit, Lampert would have "transferred more than $ 2 billion of assets to himself and to other Sears shareholders, beyond the reach of Sears creditors."

The lawsuit was filed by Sears' unsecured creditors on behalf of Sears, alleging that, "for the purpose of creating a false registration to conceal the counting of their assets, to the personal management of Lampert, Sears employees have several times produced financial plans reflecting a fantasy predicting that society would suffer an immediate and dramatic recovery from deep and growing losses to sudden profitability. "

Warren and Ocasio-Cortez also asked whether Mnuchin had attempted to forgo an ethics agreement in which he had promised "not to personally and substantially participate in a particular case involving specific parties" in which Sears would be involved. This January 2017 agreement, which had been in effect for a year, has expired.

The letter from Warren and Ocasio-Cortez indicates that Mnuchin is one of three members of the Board of the Federal Pension Supervisory Organization Pension Benefit Guaranty Corporation, or PBGC, the group that guarantees pensions from Sears.

At the confirmation hearing, Mnuchin stated that he would recuse himself from the PBGC's actions regarding Sears, but Warren and Ocasio-Cortez wrote that "the current state of your demands for disqualification – and the exact types of decision to which you are challenged – are unclear ".

Warren, one of two dozen Democrats to run for president in 2020, and Ocasio-Cortez, the most visible first-year student in the House, both strongly criticized companies and the Income inequality. Warren had been a driving force in the creation of the Office of Consumer Financial Protection and had advised the Treasury Secretary through the agency under the administration of President Barack Obama.

As a presidential candidate, Warren has proposed dismantling technology giants such as Amazon, Facebook and Google, and proposed new taxes on "ultra-millionaires" of value. greater than $ 50 million.

Ocasio-Cortez, a Democratic Socialist and the youngest woman ever to be a member of Congress, embarked on resolutely progressive speeches to solve economic and environmental problems, making her a champion of the left flank of the country. Democratic Party and a popular target of Republicans.