House Financial Services Committee calls for FDIC Chairman Grünberg to resign

Last Wednesday, the House Financial Services Committee subdued FChairman of the Federal Deposit Insurance Corporation (FDIC). Martin Grünberg on another dispute over working conditions at the FDIC. At one point, the committee chairman, Rep. Patrick McHenry (R-NC), said called on Mr. Grünberg to resign.

Grünberg’s job is at stake after one devastating investigation It found widespread sexual harassment and a toxic work culture at the banking agency he led.

• “The fact that you have not yet resigned proves that you are not taking responsibility for your actions and the words you have used so far,” McHenry said in his opening statement at the hearing, which focused on financial regulation.
• “Let me be clear, showing up today is not an act of courage,” he added. “It’s an act of hubris.”

While Mr. Gruenberg remains chairman of the FDIC, other members of the FDIC’s governing body have not been subject to similar scrutiny. These members include Michael J. Hsu, who is also Acting Comptroller of the Currency, and Rohit Chopra, who is notably also Director of the Consumer Financial Protection Bureau (CFPB), which itself handles personnel issues.

See related: Fight for raises at Consumer Financial Protection Bureau: Big raises for executives, bupkis for workers

Mr. Grünberg remains the main target of the investigation and calls for his resignation. If Mr. Gruenberg resigns, Vice Chairman Travis Hill – a Republican – would step up to the role of chairman.

Several Republicans mentioned that FDIC regulators would not tolerate the behavior outlined in the investigation if it occurred at a bank. “A terrible double standard,” said Rep. French Hill (R-Ark.)

• “Mr Grünberg, you have become the Michael Cohen and Harvey Weinstein of the FDIC. They have to go,” said Rep. Blaine Luetkemeyer (R-Missouri). (Grünberg himself has not been accused of sexual misconduct.)

Some of the Democrats on the committee also expressed displeasure with Mr. Gruenberg’s leadership of the FDIC, but did not go as far as Republican members.

Democrats on the committee expressed disappointment with Gruenberg but refrained from repeating Republican calls for his resignation.

• “I would like to talk about the substance of the economy, but if I’m honest, sitting here right now, I’m pissed,” said Rep. Gregory Meeks (D-NY).
• Meeks asked whether Gruenberg believes the bank’s current leadership can restore trust and credibility there. Gruenberg said he did.

It is challenging to imagine how Mr. Grünberg could restore “trust and credibility” after all that has happened.

See related: FDIC in the spotlight again: Another investigation reveals misconduct in leadership

FDIC scandal nearing conclusion – is there a threat of bulky rain?

An captivating thought exercise: If this were the chairman of a major corporation and not a quasi-governmental entity, the Democrats on the committee would certainly be calling for Mr. Grünberg’s removal. Interestingly – but not surprisingly – one of his most vocal supporters was on the committee predictably left-wing extremist Maxin Waters (D-CA.)

This hearing will certainly not be the last on this issue. RedState will continue to monitor the investigation into the scandals at the FDIC and will keep you updated as necessary.

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