FDIC Report Reveals Culture of Harassment and Misconduct

An investigation into the Federal Deposit Insurance Corp. (FDIC) reportedly uncovered a pervasive culture of harassment and discrimination within the agency. The probe, conducted by the law firm Cleary Gottlieb Steen & Hamilton, found that the FDIC tolerated sexual harassment, discrimination, and retaliation against employees who raised concerns. Offenders were often reassigned or promoted after complaints, according to The Wall Street Journal.

Chairman Martin Gruenberg, who leads the FDIC, was at the center of the misconduct findings. The investigation, prompted by a previous Wall Street Journal report, revealed that Gruenberg had trouble controlling his temper and was verbally abusive to staff. Many employees felt “disrespected and poorly treated” by him, the Journal reported.

The official report, expected to be released later, follows a five-month probe prompted by allegations of misogyny, sexual harassment, drinking, and partying at the FDIC. The investigation was sparked by reports that women at the FDIC received lewd comments from male coworkers and were subjected to inappropriate behavior, including receiving naked photos from senior bank examiners, leading many to leave the agency.

In a note to staff before the report’s release, Gruenberg expressed regret for the mistreatment experienced by employees. “To anyone who experienced sexual harassment or other misconduct at the FDIC, I again want to express how very sorry I am,” he wrote. “I also want to apologize for any shortcomings on my part.”

According to Reuters, over 500 people at the FDIC reported misconduct, with many of them being current employees. The FDIC had about 5,600 full-time employees in 2022.

Gruenberg, a Democrat appointed by President Joe Biden, has served as chairman of the FDIC since 2012. He had been a member of its board since 2005 and served as vice chairman from 2005 to 2011. Despite the initial claims of ignorance regarding misconduct allegations, the new report suggests Gruenberg was aware of issues within the agency.