FDIC Chairman Decides to Resign Following Damaging Reports

Following a highly critical independent review and calls for his registration, FDIC Chairman Martin Gruenberg has decided to resign from the agency. Rumblings about poor management at the regulatory agency have been rife for some time now.

Gruenberg issued the following statement:

“It has been my honor to serve at the FDIC as Chairman, Vice Chairman, and Director since August of 2005. Throughout that time I have faithfully carried out the critically important mission of the FDIC to maintain public confidence and stability in the banking system. In light of recent events, I am prepared to step down from my responsibilities once a successor is confirmed. Until that time, I will continue to fulfill my responsibilities as Chairman of the FDIC, including the transformation of the FDIC’s workplace culture.”

Earlier today, Senator Sherrod Brown, Chairman of the Senate Committee on Banking, called for Gruenberg to step down:

“After chairing last week’s hearing, reviewing the independent report, and receiving further outreach from FDIC employees to the Banking and Housing Committee, I am left with one conclusion: there must be fundamental changes at the FDIC. Those changes begin with new leadership, who must fix the agency’s toxic culture and put the women and men who work there – and their mission – first. That’s why I’m calling on the President to immediately nominate a new Chair who can lead the FDIC at this challenging time and for the Senate to act on that nomination without delay. I expect that the entire Banking and Housing Committee and Senate leaders, in both parties, will put politics aside and join this effort to bring new leadership to the agency to ensure a safe workplace for the women and men who protect our financial system.”

Brown’s statement was the final nail in the coffin, as it showed that the Democrat-appointed official had lost the support of his own party.

The independent review commissioned by the FDIC board of directors shared that between January 2015 and April 2018, approximately 8% of the respondents (191 of 2,376) had experienced sexual harassment at the FDIC. The report claims that harassment may have been underreported due to fear of retaliation.

The report also stated that Gruenberg has a “reputation within the FDIC for a temper.”

Representative Patrick McHenry, Chairman of the House Financial Services Committee, issued the following statement on the news of Gruenbergs exit:

“Chair Gruenberg is once again putting Democrats’ politicized regulatory agenda ahead of the wellbeing of the FDIC and the stability of our financial system. While his intent to resign will be welcome news to the FDIC employees who have been subjected to an appalling culture of misconduct and abuse—this announcement is too little, too late. Deep institutional changes at the FDIC are needed now. There is a clear succession plan in place and the agency’s operations would continue unabated if he rightly stepped down today. This is yet another example of Chair Gruenberg’s refusal to accept responsibility for his actions. I urge Democrats to join me in calling for Chair Gruenberg’s immediate termination.”

McHenry has previously called on Gruenberg to be fired.

 



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