NEW YORK — The chairman of the Federal Deposit Insurance Corporation (FDIC), Martin Gruenberg, will step down following the release of a critical report highlighting the agency’s toxic workplace culture, the White House announced Monday.
Gruenberg will remain in his position until a successor is appointed, with President Joe Biden expected to name a replacement “soon,” according to a White House statement. The announcement came after Senator Sherrod Brown, the top Democrat on the Senate Banking Committee, called for Gruenberg’s removal earlier the same day.
Deputy Press Secretary Sam Michel emphasized that President Biden expects the FDIC “to reflect the values of decency and integrity and to protect the rights and dignity of all employees.”
The FDIC, established during the Great Depression, is a key regulator of the U.S. banking system, primarily known for its role in insuring deposits up to $250,000.
Prior to Monday, no Democratic lawmakers had explicitly called for Gruenberg’s removal, though several had expressed concerns. Senator Brown, who is facing a challenging reelection campaign, issued a statement Monday asserting that Gruenberg’s leadership could no longer be trusted.
Gruenberg faced intense scrutiny during two days of hearings on Capitol Hill last week. The hearings focused on the FDIC’s workplace culture and the findings of an independent report by law firm Cleary Gottlieb Steen & Hamilton, which detailed numerous workplace violations.
“After chairing last week’s hearing, reviewing the independent report, and receiving further outreach from FDIC employees, I am left with one conclusion: There must be fundamental changes at the FDIC,” Brown said in his statement.
Republican lawmakers have long called for Gruenberg’s resignation and criticized the White House for not demanding his immediate departure.
Gruenberg, who has held various leadership roles at the FDIC for nearly 20 years, is serving his second full term as chairman. The report attributes much of the agency’s toxic work environment to his lengthy tenure.
The Cleary Gottlieb report, released last Tuesday, documents incidents of stalking, harassment, homophobia, and other violations based on more than 500 employee complaints. Specific allegations include a woman being stalked and harassed by a coworker despite reporting his behavior, a supervisor referring to gay men as “little girls,” and a female field examiner receiving an inappropriate photo from a senior examiner.
