“Marty Gruenberg should resign,” he added.
The senator John Kennedy (R-La.), who is also on the panel, sent Gruenberg a letter asking the same thing.
“Because of these troubling reports and your apparent reluctance to respond to them, I am calling for your resignation so that a new Chairman can restore the professional culture at the FDIC that the American people have come to expect,” Kennedy wrote.
He also asked Gruenberg for information on his handling of internal investigations into the allegations.
The Journal reported Monday that the agency had been plagued for years by a culture of sexism and sexual harassment that pushed female employees to quit. The newspaper published an article late Wednesday, citing current and former FDIC officials, that Gruenberg and top deputies were involved in decisions regarding allegations of sexism and racial discrimination in which the agency failed to adopt hard line. It also reported that Gruenberg is known to have an “explosive temper.”
The FDIC later canceled a public meeting of its board of directors, saying members would instead submit their votes in writing. Shortly afterward, Republican board members issued a statement saying the news reports undermined public trust in the agency.
“This has been a difficult week for the FDIC,” Vice Chairman Travis Hill and board member Jonathan McKernan said in the release. “Restoring trust in the work environment at the FDIC will be a challenge.”
Lawmakers had pressed Gruenberg on the allegations during oversight hearings Tuesday and Wednesday.
Gruenberg said the harassment and discrimination were “unacceptable” and told lawmakers that an independent firm would conduct a “top-to-bottom evaluation” of the agency. He said he was unaware of the allegations of labor problems at the agency before the paper’s publication.
“It is clear that FDIC employees have been subjected to horrific experiences that are simply unacceptable and cannot be tolerated,” the FDIC chief testified. “It will really be the responsibility of the agency to take whatever steps are necessary to resolve this issue and remediate it effectively.”
In their statement, Republican members of the FDIC said Gruenberg and the general counsel, who is also involved in the reports, should fully recuse themselves from the independent review and that the board, rather than management, should lead the investigation.
The White House said Thursday it supports the investigation.
“Any reports of sexual harassment and discrimination are unacceptable and we support the FDIC’s decision to conduct a thorough investigation,” said an official who asked not to be named. “I would refer you to the FDIC for any additional questions.”
representative Bill Foster (D-Ill.) also said these are “serious allegations that must be investigated and those responsible must be held accountable.”
McHenry, in a separate statement, did not call for Gruenberg’s resignation, but said he “should never have been reappointed or confirmed in the first place.” McHenry said his committee would conduct a “rigorous investigation,” including hearings and transcribed interviews.
“Under his leadership, the FDIC is at best concerned about this sideshow and at worst compromised,” McHenry said in a statement. “Chairman Gruenberg clearly bears responsibility since these allegations occurred during his tenure as a board member or president. There is no excuse for this alleged behavior, which is why the Inspector General (FDIC) should notify the committee as soon as possible.
The agency’s watchdog in 2020 found the FDIC did not have an incentive system in place to encourage employees and managers to create “a culture in which harassment is not tolerated” and to report and investigate complaints.
Gruenberg was forced to backtrack Wednesday after telling the House Financial Services Committee that he himself had never been investigated for workplace misconduct.
“You asked me a question earlier,” Gruenberg told McHenry, after Journal reporters reportedly contacted the agency for comment. “For clarification, in 2008 I was interviewed following a review conducted in response to a concern raised by an employee, and I am not aware of anything that came out of that review. »
representative Bill Huizenga On Thursday, he criticized the official for “perjuring” himself – without calling for his resignation.
“It is clear that there has been a failure of leadership,” the Michigan Republican said in a statement. “I fully expect the FDIC and its Chairman to cooperate with our investigation to ensure the safety and soundness of our financial system.”
An FDIC spokesperson said the board would take a vote scheduled for Thursday’s meeting on whether to approve a final rule that would impose additional fees on large banks to bolster their capital funds. deposit insurance following losses at two regional lenders earlier this year. year.