US Probes FDIC Toxic Workplace With Widespread Sexual Misconduct, Bullying Incidents

By Madz Dizon

May 08, 2024 04:30 AM EDT

US Probes FDIC Toxic Workplace With Widespread Sexual Misconduct, Bullying Incidents — Martin Gruenberg, Chair of the Federal Deposit Insurance Corporation (FDIC), testifies about recent bank failures during a US Senate Committee on Banking, House and Urban Affairs hearing on Capitol Hill in Washington, DC, May 18, 2023.
(Photo : SAUL LOEB/AFP via Getty Images)

An independent report released on Tuesday highlights the urgent need for the Federal Deposit Insurance Corporation to take action on issues of sexual harassment as well as misconduct.

The report also raises concerns about the future of the banking regulator's leadership.

Report Exposes FDIC Chair's Alleged Bullying, Verbal Abuse

The report, prompted by an investigation, highlighted accounts from over 500 individuals, including some who claimed that FDIC Chair Martin Gruenberg had exhibited bullying and verbal abuse.

The report by law firm Cleary Gottlieb presents a troubling image of an agency where instances of sexual harassment, racial discrimination, and bullying were widespread and endured at all levels, as per VOA News.

Senior leaders, unfortunately, allowed these behaviors to persist for an extended period of time, while individuals who spoke out against misconduct faced retaliation .

Highlighting the negative work environment within the organization, the Cleary Gottlieb report discovered that the officials responsible for addressing the issues raised by the WSJ reports were also facing allegations of misconduct.

Retaliation Fear Hinders Misconduct Reporting in FDIC

According to CBS News, employees expressed concerns about potential retaliation, which discouraged them from reporting misconduct.

The report highlighted one worker's cautious approach, as they resorted to using a VPN and someone else's email to contact the law firm, driven by their fear that senior executives might discover their complaint.

Highlighted in the report are several instances of misconduct:

One female employee expressed concern for her physical safety after a coworker pursued her and continued to email her.
A male boss at a field office frequently discussed his female employees' breasts and legs, as well as his own sex life.
A senior bank examiner unexpectedly texted a woman examiner about his genitals while she was in detail in a field office.
Colleagues told workers from underrepresented groups that they were "only hired" because they belonged to such groups, and that they were "token" employees employed to achieve a quota.