Accounting
Trump nominates hedge fund chief Bessent to lead Treasury
Published
4 months agoon

President-elect Donald Trump said he is nominating Scott Bessent, who runs macro hedge fund Key Square Group, as the next U.S. Treasury secretary, enlisting a key adviser to manage the sweeping economic agenda he has vowed to enact in a second term.
“Scott has long been a strong advocate of the America First Agenda,” Trump said in a statement Friday. “On the eve of our Great Country’s 250th Anniversary, he will help me usher in a new Golden Age for the United States, as we fortify our position as the World’s leading Economy.”
Bessent, 62, emerged as the pick after an extended search for a Treasury chief that saw Trump consider multiple candidates — and Wall Street executives and business leaders vie to influence the president-elect’s decision. Allies believed that Trump sought a candidate that would be favored both by Wall Street as well as an electoral base eager for him to implement

Stefani Reynolds/Bloomberg
Bessent beat out other prominent contenders including Apollo Global Management Inc. executive Marc Rowan, former Federal Reserve Governor Kevin Warsh and Tennessee Senator Bill Hagerty as well as Trump transition co-chair Howard Lutnick, who was named to lead the Commerce Department.not supported.
If confirmed by the Senate, Bessent would be the first openly gay Treasury chief, and one of the wealthiest in modern times. Bessent has said that he has always wanted to serve his country, but in the 1980s his sexual orientation prevented him from going to the U.S. Naval Academy, and after graduating from Yale University, from joining the State Department.
He joins an economic team beginning to take shape just weeks after Trump won a second presidential term. Trump announced that his former budget director, Russ Vought, would be returning to the same role in a statement to his social media platform later Friday.
“He did an excellent job serving in this role in my First Term – We cut four Regulations for every new Regulation, and it was a Great Success!” Trump said.
Vought, a key architect of
Political thickets
As the nation’s highest ranking economic policymaker, Bessent will have to wade through political thickets in Washington, spearhead international economic diplomacy and bring Wall Street know-how to crisis situations. He will also be closely watched by investors and financial institutions, who are looking for predictability and stability.
He has been a proponent of realigning U.S. currency policy, but has stopped short of supporting an overt strategy of depreciating the dollar. During Trump’s first term, the then-president called out dollar appreciation for being harmful to US manufacturers and even considered government intervention to manage the greenback’s value.
Bessent has acknowledged that while a weaker dollar would be good for some parts of the economy, some of Trump’s proposals would drive up its value.
He has criticized President Joe Biden’s administration for its management of federal debt financing, and has talked about expanding its “friendshoring” policy to create a tiered system among trade partners.
At the Treasury, Bessent is expected to advise Trump on candidates to chair the Federal Reserve when that job opens up in May 2026. Earlier this year, he talked about the
He has said the Fed was too slow to respond to rising inflation in 2021, and
Bessent spent part of his career managing money for billionaire George Soros. He lived in London and was part of the team, under Stan Druckenmiller, that made $1 billion in 1992 shorting the pound — a wager that helped force the currency out of the European Exchange Rate Mechanism, and made Soros famous as the man who broke the Bank of England.
He would be the second Treasury secretary, after Steven Mnuchin, who has worked for groups with close ties to Soros.
Soros’ family office made about $10 billion in profit under Bessent as investment chief, or about 13% annualized. Since then, he’s run Key Square, which started with a $2 billion investment from Soros — funds he later returned as other investors came in.
“I think he’ll be outstanding,” said Druckenmiller. “Having worked for me and George for all those years, he’s been exposed to everything a Treasury secretary has to deal with. He has a deep knowledge of markets and he’s also an intellectual who has the chops to work with academic policymakers. It’s a rare combination.”
Bessent will be returning his hedge fund clients’ capital as soon as possible after Dec. 1, according to a person familiar with his plans. Federal rules require cabinet members to develop plans to remove their potential conflicts of interest, and then follow through on them, usually within as little as 90 days.
Here’s a look at some key areas of responsibility for the role of Treasury Secretary:
Oversight, taxes
Bessent is expected to play a key role in pushing for a renewal of Trump’s 2017 tax cuts through Congress, many of which are set to expire at the end of 2025.
The Treasury chief could be charged with liaising with Republicans in Congress to expand the scope of the tax bill to include some of Trump’s campaign-trail tax promises, including a 15% corporate rate and exempting tipped wages from taxation.
The Treasury Secretary is also charged with running the Financial Stability Oversight Council, a panel set up after the financial crisis. Under outgoing Treasury Secretary Janet Yellen, FSOC looked at the issue of
FSOC under Yellen also recommended stronger oversight of stablecoins, which the Fed has likened to bank deposits and money market funds — and which are subject to much more regulation. Trump’s advocacy of the crypto space on the campaign trail likely will put the new Treasury chief’s stance under the spotlight.
Economic diplomacy
Peppered through the year are meetings of the finance chiefs of the Group of Seven, G-20 and other international organizations, which the Treasury secretary typically attends as the chief U.S. representative.
The Treasury Department implements U.S. sanctions on foreign countries, companies and individuals, which have soared in number over the past several years. Yellen helped to lead efforts at the G-7 to isolate Russia after its full-scale invasion of Ukraine, and to step up financial assistance for Kyiv.
The secretary also has often served as point person on engagement with China. The Treasury chief tends to be a cautionary voice when it comes to proposals aimed at America’s biggest strategic rival. Mnuchin, Trump’s Treasury head in his first term, was seen as playing that role when tensions escalated in 2018 and 2019.
Debt management
In charge of the nation’s purse strings, Bessent will have to deal with a costly, and ballooning, debt load. The federal budget deficit crept up to
“No one has been more terrified about this debt stack and the coming refinance we’ve got to do,” Bessent said on a recent War Room
Bessent has also
Debt managers may need to be active in managing the Treasury’s liquidity, because the federal debt ceiling is scheduled to
Glen Capelo, who spent more than three decades on Wall Street bond-trading desks and is now a managing director at Mischler Financial Group, called Bessent a “fiscal hawk.”
“He definitely will be positive overall for the economy and the markets. He wants to rein in spending. Bessent wants to get the Secretary of the Treasury back in line with the markets – because he does believe Janet Yellen has twisted the issuance around a bit,” Capelo said.
You may like
Accounting
Accountants tackle tariff increases after ‘Liberation Day’
Published
59 minutes agoon
April 3, 2025
President Trump’s imposition of steep tariffs on countries around the world is likely to drive demand for accounting experts and consultants to help companies adjust and forecast the ever-changing percentages and terms.
On April 2, which Trump dubbed “Liberation Day,” he announced a raft of reciprocal tariffs of varying percentages on trading partners across the globe and signed an
“A lot of CFOs are thinking they are going to pass along the tariffs to their customer base, and about another half are thinking we’re going to absorb it and be more creative in other ways we can save money inside our company,” said Tom Hood, executive vice president for business engagement and growth at the AICPA & CIMA.
The AICPA & CIMA’s most recent
“CFOs in our community are telling us that, effectively, they’re looking at this a lot like what happened over COVID with a big disruption out of nowhere,” said Hood. “This one, they could see it coming. But the point is they had to immediately pivot into forecasting and projection with basically forward-looking financial analysis to help their companies, CEOs, etc., plan for what could be coming next. This is true for firms who are advising clients. They might be hired to do the planning in an outsourced way, if the company doesn’t have the finance talent inside to do that.”
The tariffs are not set in stone, and other countries are likely to continue to negotiate them with the U.S., as Canada and Mexico have been doing in recent months.
“The one thing that I think we can all count on is a certain amount of uncertainty in this process, at least for the next several months,” said Charles Clevenger, a principal at UHY Consulting who specializes in supply chain and procurement strategy. “It’s hard to tell if it’s going to go beyond that or not, but it certainly feels that way.”
Accountants will need to make sure their companies and clients stay compliant with whatever conditions are imposed by the U.S. and its trading partners. “This is a more complex tariff environment than most companies have experienced in the past, or that seems to be where we’re headed, and so ensuring compliance is really important,” said Clevenger.
Big Four firms are advising caution among their clients.
“Our point of view is we’re advising all of our clients to do a few things right out of the gate,” said Martin Fiore, EY Americas deputy vice chair of tax, during a webinar Thursday. “Model and analyze the trade flows. Look at your supply chain structures. Understand those and execute scenario planning on supply chain structures that could evolve in new environments. That is really important: the ability for companies to address the questions they’re getting from their C-suite, from their stakeholders, is critical. Every company is in a different spot according to the discussions we’ve had. We just are really emphasizing, with all the uncertainty, know your structure, know your position, have modeling put in place, so as we go through the next rounds of discussions over many months, you have an understanding of your structure.”
Scenario planning will be especially important amid all the unpredictability for companies large and small. “They’re going to be looking at all the different countries they might have supply chains in,” said Hood. “And then even the smaller midsized companies that might not be big, giant global companies, they might be supplying things to a big global company, and if they’re in part of that supply chain, they’ll be impacted through this whole cycle as well.”
Accountants will have to factor the extra tariffs and import taxes into their costs and help their clients decide whether to pass on the costs to customers, while also keeping an eye out for pricing among their competitors and suppliers.
“It’s just like accounting for any goods that you’re purchasing,” said Hood. “They often have tariffs and taxes built into them at different levels. I think the difference is these could be bigger and they could be more uncertain, because we’re not even sure they’re going to stick until you see the response by the other countries and the way this is absorbed through the market. I think we’re going through this period of deeper uncertainty. Even though they’re announced, we know that the administration has a tendency to negotiate, so I’m sure we’re going to see this thing evolve, probably in the next 30 days or whatever. The other thing our CFOs are reminding us of is that the stock market is not the economy.”
Amid the market fluctuations, companies and their accountants will need to watch closely as the rules and tariff rates fluctuate and ensure they are complying with the trading rules. “Do we have country of origin specified properly?” said Clevenger. “Are we completing the right paperwork? When there are questions, are we being responsive? Are we close to our broker? Are we monitoring our customs entries and all the basic things that we need to do? That’s more important now than it has been in the past because of this increase in complexity.”
Accounting
How to use opportunity zone tax credits in the ‘Heartland’
Published
2 hours agoon
April 3, 2025
A tax credit for investments in low-income areas could spur long-term job creation in overlooked parts of the country — with the right changes to its rules, according to a new book.
The capital gains deferral and exclusions available through the “opportunity zones” credit represent one of the few areas of the Tax Cuts and Jobs Act of 2017 that drew support from both Republicans and Democrats. The impact of the credit, though, has proven murky in terms of boosting jobs and economic growth in the roughly 7,800 Census tracts qualifying based on their rates of poverty or median family incomes.
Altering the criteria to focus the investments on “less traditional real estate and more innovation infrastructure” and ensuring they reach more places outside of New York and California could “refine the where and the what” of the credit, said Nicholas Lalla, the author of “
“I don’t want to sound naive. I know that investors leveraging opportunity zones want to make money and reduce their tax liability, but I would encourage them to do a few additional things,” Lalla said. “There are communities that need investment, that need regional and national partners to support them, and their participation can pay dividends.”
READ MORE:
A call to action
In the book, Lalla writes about how the Innovation Labs received $200 million in fundraising through public and private investments for projects like a startup unmanned aerial vehicle testing site in the Osage Nation called the Skyway36 Droneport and Technology Innovation Center. Such collaborations carry special relevance in an area like Tulsa, Oklahoma, which has a history marked by the wealth ramifications of the
“This book is a call to action for the United States to address one of society’s defining challenges: expanding opportunity by harnessing the tech industry and ensuring gains spread across demographics and geographies,” he writes. “The middle matters, the center must hold, and Heartland cities need to reinvent themselves to thrive in the innovation age. That enormous project starts at the local level, through place-based economic development, which can make an impact far faster than changing the patterns of financial markets or corporate behavior. And inclusive growth in tech must start with the reinvention of Heartland cities. That requires cities — civic ecosystems, not merely municipal governments — to undertake two changes in parallel. The first is transitioning their legacy economies to tech-based ones, and the second is shifting from a growth mindset to an inclusive-growth mindset. To accomplish both admittedly ambitious endeavors, cities must challenge local economic development orthodoxy and readjust their entire civic ecosystems for this generational project.”
READ MORE:
Researching the shortcomings
And that’s where an “opportunity zones 2.0” program could play an important role in supporting local tech startups, turning midsized cities into innovation engines and collaborating with philanthropic organizations or the federal, state and local governments, according to Lalla.
In
Other research suggested that opportunity-zone investments in metropolitan areas generated a 3% to 4.5% jump in employment, compared to a flat rate in rural places,
“It creates a strong incentive for taxpayers to make investments that will appreciate greatly in market value,” Tax Foundation President Emeritus Scott Hodge wrote in the analysis, “Opportunity Zones ‘Make a Good Return Greater,’ but Not for Poor Residents” shortly after the Treasury study.
“This may be the fatal flaw in opportunity zones,” he wrote. “It explains why most of the investments have been in real estate — which tends to appreciate faster than other investments — and in Census tracts that were already improving before being designated as opportunity zones.”
So far, three other research studies have concluded that the investments made little to no impact on commercial development, no clear marks on housing prices, employment and business formation and a notable boost in multifamily and other residential property,
The credit “deviates a lot from previous policies” that were much more prescriptive, Feldman said.
“It didn’t want the government to have a lot of oversay over what was going on, where the investment was going, the type of investments and things like that,” she said. “It offered uncapped tax incentives for private individual investors to invest unrealized capital gains. So this was the big innovation of OZs. It was taking the stock of unrealized capital gains that wealthy individuals, or even less wealthy individuals, had sitting, and they could roll it over into these funds that could then be invested in these opportunity zones. And there were a lot of tax breaks that came with that.”
READ MORE:
A ‘place-based’ strategy
The shifts that Lalla is calling for in the policy “could either be narrowing criteria for what qualifies as an opportunity zone or creating force multipliers that further incentivize investments in more places,” he said. In other words, investors may consider ideas for, say, semiconductor plants, workforce training facilities or data centers across the Midwest and in rural areas throughout the country rather than trying to build more luxury residential properties in New York and Los Angeles.
While President Donald Trump has certainly favored that type of economic development over his career in real estate, entertainment and politics, those properties could tap into other tax incentives. And a refreshed approach to opportunity zones could speak to the “real innovation and talent potential in midsized cities throughout the Heartland,” enabling a policy that experts like Lalla describe as “place-based,” he said. With any policies that mention the words “
“We can’t have cities across the country isolated from tech and innovation,” he said. “When you take a geographic lens to economic inclusion, to economic mobility, to economic prosperity, you are including communities like Tulsa, Oklahoma. You’re including communities throughout Appalachia, throughout the Midwest that have been isolated over the past 20 years.”
READ MORE:
Hope for the future?
In the book, Lalla compares the similar goals of opportunity zones to those of earlier policies under President Joe Biden’s administration like the Inflation Reduction Act, the CHIPS and Science Act, the American Rescue Plan and the Infrastructure Investment and Jobs Act.
“Together, these bills provided hundreds of millions of dollars in grant money for a more diverse group of cities and regions to invest in innovation infrastructure and ecosystems,” Lalla writes. “Although it will take years for these investments to bear fruit, they mark an encouraging change in federal economic development policy. I am cautiously optimistic that the incoming Trump administration will continue this trend, which has disproportionately helped the Heartland. For example, Trump’s opportunity zone program in his first term, which offered tax incentives to invest in distressed parts of the country, should be adapted and scaled to support innovation ecosystems in the Heartland. For the first time in generations, the government is taking a place-based approach to economic development, intentionally seeking to fund projects in communities historically disconnected from the nation’s innovation system and in essential industries. They’re doing so through a decidedly regional approach.”
Advisors and
“This really is a bipartisan issue. Opportunity zones won wide bipartisan approval,” he said. “Heartland cities can flourish and can do so in a complicated political environment.”
Accounting
Ramp releases tool to detect fraudulent AI-generated receipts
Published
2 hours agoon
April 3, 2025
Dave Wieseneck, an “expert in residence” at Ramp who administers the company’s own instance of Ramp, noted that faking receipts is not a new practice. What’s changed is that, with the recent
“So while it’s always been possible to create fake receipts, AI has made it super duper easy, especially OpenAI with their latest model. So I think it’s just super easy now and anybody can do it, as opposed to experts that are in the know,” he said in an interview.

Rather than try to assess the image itself, the software looks at the file’s
“When we see that these markers are present, we have really high confidence of high accuracy to identify them as potentially AI generated receipts,” said Wieseneck. “I was the first person to test it out as the person that owns our internal instance of Ramp and
While the speed at which they produced this solution may be remarkable, he said it is part of the company culture. The team, especially small pods within it, will observe a problem and stop what they’re doing to focus on a specific need. They get a group together on a Slack channel, work through the problem, code it late at night and push it out in the morning.
Wieseneck conceded it is not a total solution but rather a first line of defense to deter the casual fraudster. He compared it to locking your door before going out. If the front door is unlocked, a person can just stroll in and steal everything, but will likely give up if it is locked. A professional criminal with tons of breaking and entering experience, however, is unlikely to be deterred by a lock alone, versus a lock plus an alarm system plus an actual security guard.
“But that doesn’t mean that you don’t lock your door and you don’t add pieces of defense to make it harder for people to either rob your house or, in this case, defraud your company,” he said.
This isn’t to say there’s no plans to bolster this solution further. After all, the feature is only days old. He said the company is already looking into things like pixel analysis and textual analysis of the document itself to further enhance its AI detection capabilities, though he stressed that they want to be very confident it works before pushing it out to customers.
“We’re focused on giving finance teams confidence that legitimate receipts won’t be falsely flagged. So we want to tread carefully. We have lots of ideas. We’re going to work through them and kind of solve them in the same process we’ve always done here at Ramp,” he said.
This is likely only the beginning of AI image generators being used to fake documentation. For instance, it has recently been found that bots are also very good at forging
AI fraud ascendant
This speaks to an overall trend of AI being used in financial crimes which was highlighted in a
The poll found that 61% of respondents say use of AI by cybercriminals is a leading catalyst for risk exposure, such as through the generation of deep fakes and, likely, AI-generated financial documents. While 57% think AI will help against financial crime, 49% think it will hinder (Kroll said they are likely both right).
“The rapid-fire adoption of AI tools can be a blessing and a curse when it comes to financial crime, providing new and more efficient ways to combat it while also creating new techniques to exploit the broadening attack surface — be it via AI-powered phishing attacks, deepfakes, or real-time mimicry of expected security configurations,” said the report.
Yet, many professionals do not feel their current programs are up to the task. The rise in AI-guided fraud is part of an overall projected 71% increase in financial crime risks in 2025. Meanwhile, only 23% rate their compliance programs as “very effective” with lack of technology and investment named as prime reasons. Many also lack confidence in the governance infrastructure overseeing financial crime, with just 29% describing it as “robust.”
They’re also not entirely convinced that more AI is the solution. The poll found that confidence in AI technology has dropped dramatically over the past two years: those who say AI tools have had a positive impact on financial crime compliance have gone from 39% in 2023 to only 20% today. Despite this, there remains heavy investment in AI. The poll found 25% already say AI is an established part of their financial crime compliance program, and 30% say they are in the early stages of adoption. Meanwhile, in the year ahead, 49% expect their organization will invest in AI solutions to tackle financial crime, and 47% say the same about their cybersecurity budgets.
To help combat AI-enabled financial crime, Kroll recommended companies form cross-functional teams that go beyond IT and cybersecurity and involve those in AML, compliance, legal, product and senior management. Further, Kroll said there has to be focused, hands-on training with new AI tools that are updated and repeated as the organization implements new AI capabilities and the regulatory and risk landscape changes. Finally, to combat AI-related fraud, Kroll recommended companies maintain a “back to the basics” approach. Focus on fundamental human intervention and confirmation procedures — regardless of how convincing or time-sensitive circumstances appear.

U.S. tariff rates under Trump will be higher than the Smoot-Hawley levels from Great Depression era

Accountants tackle tariff increases after ‘Liberation Day’

How to use opportunity zone tax credits in the ‘Heartland’

New 2023 K-1 instructions stir the CAMT pot for partnerships and corporations

The Essential Practice of Bank and Credit Card Statement Reconciliation

Are American progressives making themselves sad?
Trending
-
Economics1 week ago
Young Americans are losing confidence in economy, and it shows online
-
Personal Finance1 week ago
Student loans could be managed by the Small Business Administration
-
Economics6 days ago
PCE inflation February 2025:
-
Accounting6 days ago
IRS sets new initiative with banks to uncover fraud
-
Economics1 week ago
White House denials over the Signal snafu ring hollow
-
Economics6 days ago
Consumer sentiment worsens as inflation fears grow, University of Michigan survey shows
-
Economics1 week ago
Texas troopers are in more and more lethal car chases
-
Personal Finance1 week ago
Social Security delays date for new ID policies following complaints