1 year ago
The Federal Deposit Insurance Corp. on Thursday canceled an open meeting of its board of directors moments after it was slated to begin, as FDIC Director Martin Gruenberg faces pressure over reports of a toxic workplace culture at the agency.
The board, however, will proceed with a vote on whether to approve a final rule that would charge big banks an additional fee to shore up its deposit insurance fund following losses from two regional lenders earlier this year, the agency announced via e-mail.
A spokesperson for the bank regulator did not immediately respond to a request for comment on why the open meeting was scrapped.
The Wall Street Journal on Monday reported that the agency has for years been plagued by a toxic work environment, including a culture of sexism and sexual harassment that has led female employees to quit.
Lawmakers pressed Gruenberg on the allegations in oversight hearings on Tuesday and Wednesday.
Gruenberg said harassment and discrimination are “unacceptable” and told lawmakers on Tuesday that an independent firm would conduct a “top-to-bottom assessment” of the agency. He said he had been unaware of the allegations of workplace problems at the agency prior to the Journal’s reporting.
The FDIC’s inspector-general in 2020 found the agency 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 on Wednesday was forced to backtrack 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 Committee Chair Patrick McHenry (R-N.C.), reportedly after Journal reporters contacted the agency for comment. “For clarification, in 2008, I was interviewed pursuant to a review done in response to a concern raised by an employee, and I'm not aware of anything that came out of that review.”
FDIC Vice Chair Travis Hill and board member Jonathan McKernan, both Republicans, issued a joint statement Wednesday saying the board must hold “all responsible employees and managers accountable for any inappropriate conduct.”
“It is vital that the independent review initiated by the Chairman be effectively overseen by the board and have the latitude and time needed to conduct a thorough, holistic review,” they said. “The board should be appropriately informed throughout the review process.
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