A House committee hearing Wednesday on workplace issues within the Federal Deposit Insurance Corp. turned into political sparring between Democrats and Republicans, with both emphasizing the need for change at the agency but with a clear difference in how they expect that to happen.
Beginning with Rep. Patrick McHenry of North Carolina, Republican lawmakers shared repeatedly that they believed FDIC Chair Martin Gruenberg must vacate his position immediately or be removed by President Joe Biden for the agency to begin addressing alleged widespread sexual harassment.
Gruenberg said last month that he would resign once a successor is confirmed, a move that would preserve a Democratic majority on the FDIC board and potentially enable a contentious capital requirements revamp to pass.
McHenry had requested Gruenberg appear at a separate hearing later Wednesday, but the FDIC chair could not attend because of a scheduling conflict, an agency spokesperson said Friday.
Rep. Maxine Waters, D-CA, noted that despite calls for Gruenberg’s removal, “you won't hear [Republicans] call for Republican Vice Chair Travis Hill to step down, despite him being a senior official under former Chair [Jelena] McWilliams when allegations of misconduct persisted.”
“I also wonder whether my colleagues will call for anyone who has been found liable for sexual abuse to stand down from holding other positions of power in government — like, for example, the former president and top Republican,” Waters said, referring to former President Donald Trump.
FDIC board members Michael Hsu and Jonathan McKernan attended the hearing, along with Joon Kim and Abena Mainoo, partners at law firm Cleary Gottlieb. That firm last month released a damning report on the regulator, finding that “for far too many employees and for far too long, the FDIC has failed to provide a workplace safe from sexual harassment, discrimination, and other interpersonal misconduct.”
Rep. French Hill, R-AR, asked Mainoo if the FDIC was a place she would like to work.
“I think that's a difficult question to answer in that … we heard from the FDIC employees who reported to us how proud they are to work at the FDIC,” Mainoo said.
Hill said he’s glad to hear that Biden will soon appoint a replacement for Gruenberg, referring to a report this week in The Wall Street Journal that the president will nominate Christy Goldsmith Romero, a commissioner with the Commodity Futures Trading Commission, to lead the FDIC.
However, in light of how long the confirmation process will take, “we should have the transition today and the current chairman should be out of his office in order to move this atmosphere forward,” Hill said.
Continuing the political sparring, Rep. Stephen Lynch, D-MA, noted Republicans’ support of Trump amid allegations related to sexual misconduct, along with 34 recent felony convictions.
“There’s real reason to question the genuineness on my colleagues’ part,” he said.
Rep. Andy Barr, R-KY, blasted Democrats’ decision not to demand Gruenberg leave his post immediately — and Gruenberg’s conditional resignation — as a bald political maneuver.
“If he leaves the agency, we'll have two Democrats and two Republicans. It’s supposed to be an independent regulatory agency … That means [Gruenberg’s] more concerned about threats to the Biden administration's partisan regulatory agenda than he is about cleaning up the mess he created,” Barr said.
Questioned by lawmakers, Kim did not say whether he believed Gruenberg needed to be removed from his position, adding that such a judgment was beyond the scope of the review Cleary Gottlieb conducted.
Hsu, the acting comptroller of the currency, said he conditionally supports Gruenberg remaining in his position for now, “so long as the chairman is delivering on commitments and taking actions.”
