FDIC Slow to Cleanup “Toxic” Workplace Culture
The Federal Deposit Insurance Corporation (FDIC) is once again in the crosshairs for failing to clean up its workplace culture, which includes incidents of sexual harassment.
In a new report, the FDIC Office of Inspector General (OIG) found that the agency failed for several years to implement “an effective sexual harassment prevention program that facilitates the reporting of sexual harassment misconduct allegations and has not always investigated and addressed allegations of sexual harassment promptly and effectively.”
The report, which was an update to a 2020 report on how the FDIC handles harassment allegations, also found that changes the FDIC planned to make following the 2020 report, were largely not sustained.
The report noted that failure to implement such changes means employees are “experiencing an environment of distrust, and many employees do not feel comfortable reporting sexual harassment at the FDIC or are afraid of reporting for fear of retaliation.”
The report found that FDIC leadership failed in several areas:
Has not demonstrated sufficient commitment to, and accountability for, the Anti-Harassment Program (AHP);
Has not implemented an effective program structure or dedicated sufficient resources to the program;
Does not have an effective system for tracking, addressing, and documenting allegations;
Has not established adequate complaint procedures or an adequate AHP policy; and
Has not provided sufficient training to its supervisors and staff.
The report also noted that of the 2,812 FDIC employees who responded to the OIG survey, 191 said they had been sexually harassed at work, However, the FDIC told OIG that it received just 34 sexual harassment complaints for the same time period, indicating an underreporting of claims.
The report made 24 recommendations to help the FDIC clean up its culture. The agency agreed with all 24 and plans to take corrective action by March 31, 2025.
Independent Investigation
This new report comes on the heels of an independent review from law firm Cleary Gottlieb Steen & Hamilton, that detailed an FDIC workplace culture that was rife with hostile, abusive, non-professional conduct with incidents of stalking, harassment, homophobia and other violations of employment regulations.
The incidents had been going on for years and were first detailed by the Wall Street Journal.
Following the law firm’s report, FDIC Chairman Martin Gruenberg agreed to resign once a successor is confirmed, even though Chairman Gruenberg was not found to be a “root cause” of the sexual harassment and discrimination at the agency.
Nomination Pending
President Biden nominated Christy Goldsmith Romero, who is currently a commissioner at the Commodity Futures Trading Commission (CFTC) to the FDIC post.
At her confirmation hearing before the Senate Banking Committee in July, Commissioner Romero said she would prioritize fixing FDIC culture saying, “It must not continue and I will bring accountability.”
That nomination is still pending.
