FDIC Chair Gruenberg to Resign After Allegations

(ReliableNews.org) – The Federal Deposit Insurance Corporation (FDIC) is an independent agency that has insurance on depositors’ money in banks insured by it. Congress created the agency to maintain trust in America’s banking system. The head of the agency recently resigned, just as new banking rules are set to take effect.

On May 20, FDIC Chairman Martin Gruenberg announced he was resigning from office. He said that “in light of recent events” he’s stepping down but will continue serving in the role until his successor is found. He promised to work to change the culture at the agency while he’s still there.

The chairman’s decision came after an investigation, prompted by a report in the Wall Street Journal, found widespread racial discrimination, harassment, and bullying within the agency. Republicans were pressuring the Democrat to step aside. Even Senator Sherrod Brown (D-OH) called on the chairman to resign, saying new leadership should “fix the agency’s toxic culture.”

The Cleary Gottlieb law firm released the report, saying more than 500 people contributed their experiences with investigators.

According to its findings, senior leaders in the agency permitted misconduct at every level. When a person complained about mistreatment, they were retaliated against. The report stated the agency failed to ensure employees had a safe working environment free from harassment and discrimination “for far too long.”

Individuals accused of harassing employees were often given new roles instead of being fired. Even the people the FDIC tasked with addressing the toxic workplace issues faced allegations of misconduct and harassment. Employees complained about Gruenberg too, saying he lost his temper regularly and was often aggressive with employees.

President Joe Biden said he will nominate someone to fill the position soon. Sam Michel, the acting deputy White House press secretary, promised the POTUS would choose someone committed to the FDIC’s values and who would protect consumers while protecting the US financial system.

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