Business & Economy

On The Money: Watt’s accuser describes sexual harassment claims in stunning testimony | SEC sues Elon Musk for fraud | Mnuchin says GOP hasn’t lost messaging war on taxes

Happy Thursday and welcome back to On The Money. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

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Washington was riveted Thursday as Christine Blasey Ford offered gripping testimony before the Senate about allegations that Supreme Court nominee Brett Kavanaugh tried to rape her at a party in 1982. Kavanaugh later offered his own forceful defense, which appeared to boost Republican resolve to push ahead with his confirmation vote. But it wasn’t the only hearing detailing alleged sexual misconduct claims…

 

THE BIG DEAL–Mel Watt’s accuser describes sexual harassment claims in stunning testimony: A Federal Housing Finance Agency (FHFA) employee who has accused Director Mel Watt of sexual harassment described her allegations Thursday in gripping testimony before a House committee.

Simone Grimes, a special adviser at FHFA, told lawmakers that Watt made dozens of sexual advances toward her, withheld a promised pay raise over her refusal of his advances and was protected by senior agency officials charged with investigating her accusations.

{mosads}Grimes told the House Financial Services Committee that the FHFA’s Office of Inspector General responded to her claims with “hostility, intimidation, bullying, laden with gossip and public shaming” and sought to protect Watt throughout the process.

“Not only are you hurt by what has happened, but you quickly learn that all of the agency mechanisms that you hope have a sympathetic ear are not only slightly hostile, but make it clear that they’re not there to support you, but defend their client no matter what their client has done,” Grimes said.

I’ve got a recap of the hearing here.

 

Grimes’s allegations:

 

Watt’s defense:

 

How lawmakers weighed in:

 

LEADING THE DAY

SEC sues Elon Musk for fraud, seeks removal from Tesla: The Securities and Exchange Commission (SEC) is suing Tesla CEO Elon Musk over his controversial Twitter announcement of a non-existent deal to take the company private.

The suit alleges that Musk committed securities fraud. Shares of Tesla immediately dipped by roughly 4 percent after the news.

The SEC is seeking to remove Musk from Tesla and ban him from being an officer of a publicly traded company. The commission is also suing Musk to pay civil penalties for the alleged fraud and to forfeit any profit made from the actions stated in their charges.

Musk is one of the highest profile executives the agency has pursued fraud charges against.

The SEC along with the Department of Justice was investigating the company after Musk tweeted earlier in the year that he had secured funding to take Tesla private at $420 a share.

“Am considering taking Tesla private at $420. Funding secured.” Musk tweeted in August.

The SEC concluded in its investigation that “[t]his statement was false and misleading.”

The Hill’s Ali Breland tells us why here.

 

Mnuchin: GOP hasn’t lost the messaging war on tax law: Treasury Secretary Steven Mnuchin on Thursday pushed back on arguments that Republicans have failed to successfully sell President Trump’s tax law to the public, saying taxpayers are just now starting to see the effects of the 2017 measure.

“I don’t think we’ve lost the message war at all,” Mnuchin said at an event hosted by The Hill and sponsored by EJF Capital.

Mnuchin said the Federal Reserve has estimated that gross domestic product will exceed 3 percent for the year, and he touted elements of the tax law, such as a provision that allows businesses to immediately write off the cost of capital investments.

“We’re just beginning to see the beginning impact, and I think over the next few years we’ll see that continue on,” he said.

Mnuchin’s comments come as polls have shown a lack of widespread support for Trump’s tax law, which the president signed in December.

The Hill’s Naomi Jagoda tells us more about that dynamic and Mnuchin’s view of the economy here.

 

Analysis finds 77 percent of small firms in Puerto Rico suffered hurricane losses: An overwhelming majority of small businesses in Puerto Rico suffered quantifiable losses as a result of Hurricanes Maria and Irma last year, according to a new report by the Federal Reserve Bank of New York.

In its annual survey of Puerto Rico small businesses, the New York Fed found that 77 percent of businesses reported losses directly related to the 2017 hurricanes, and insurance coverage was insufficient in addressing those damages.

The New York Fed surveyed 407 companies, each with fewer than 500 employees, between March and May and found that only 4 percent of firms with insurance had their damages fully covered. Twenty three percent had their losses partially covered. The Hill’s Rafael Bernal breaks down the data here.

 

GOOD TO KNOW

 

ODDS AND ENDS