FDCI Inspector General Initiates Investigation into Sexual Harassment Allegations

A watchdog overseeing the U.S. Federal Deposit Insurance Corp will conduct a “special inquiry” into how the bank regulator’s leadership has handled complaints about sexual harassment and other inappropriate conduct, a representative for the watchdog said on Tuesday.

A “new evaluation project” will also review FDIC reform efforts since a 2020 investigation found its handling of sexual harassment complaints was deficient, said Caitlin Savino, spokesperson for the FDIC Office of Inspector General.

Previously, FDIC officials said the agency had satisfied recommendations from that investigation. An agency representative declined to comment.

The newest investigation will focus on FDIC leadership, which adds to turmoil surrounding Chair Martin Gruenberg, who this month faced calls for his resignation from Republican lawmakers following a Wall Street Journal report.

In a series of reports, the newspaper cited a toxic culture of misogyny and discrimination among the agency’s male-dominated staff in alleged incidents stretching back more than a decade.

The working conditions caused numerous women to quit, which lawmakers said raised questions about whether FDIC supervision’s effectiveness was suffering in light of major bank failures this year.

Gruenberg has expressed personal alarm at the accounts and vowed to address the matter as a top agency priority.

This month, the FDIC’s board of directors announced that a bipartisan special committee not involving Gruenberg would oversee the agency’s own independent review of its workplace culture.

Republican board members had insisted that Gruenberg recuse himself from the review. Republican lawmakers on the House Financial Services Committee have announced the start of a “rigorous” congressional probe into the matter.