President Joe Biden is expected to nominate a new chairman for the Federal Deposit Insurance Corporation (FDIC) soon, following a commitment from the current chairman, Martin Gruenberg, to step down once a successor is confirmed by the Senate.
Background
Gruenberg has been under intense scrutiny after a report from an external law firm revealed a toxic work environment at the FDIC, characterized by widespread sexual harassment and discrimination. The report questioned whether Gruenberg was capable of instituting the necessary reforms to address these issues.
Congressional Response
At recent congressional hearings, Republican lawmakers demanded Gruenberg’s immediate resignation. However, some Democrats were reluctant, concerned that it would leave a Republican vice chair in charge, potentially hindering efforts to enforce stricter capital requirements for banks.
Senate Banking Committee Chairman’s Call
A significant shift occurred when Senator Sherrod Brown (D-Ohio), chairman of the Senate Banking Committee, called on the White House to replace Gruenberg. “There must be fundamental changes at the FDIC,” Brown said. “Those changes begin with new leadership, who must fix the agency’s toxic culture and put the women and men who work there – and their mission – first.”
Gruenberg’s Response
In response, Gruenberg stated his willingness to resign but insisted on remaining in his position until a Democratically-appointed successor is confirmed. “Until that time, I will continue to fulfill my responsibilities as Chairman of the FDIC, including the transformation of the FDIC’s workplace culture,” he said.
White House Statement
The White House announced that President Biden would nominate a new FDIC chairman “soon” and urged the Senate for swift confirmation. Deputy White House press secretary Sam Michel emphasized the President’s commitment to integrity and protecting employee rights, stating, “The President of course expects the Administration to reflect the values of decency and integrity and to protect the rights and dignity of all employees.”
Republican Opposition
Republicans criticized the decision to keep Gruenberg in place during the confirmation process. Senator Tim Scott (R-South Carolina), the ranking Republican on the banking committee, said, “If President Biden and Democrats were really serious about supporting employees and fixing the FDIC’s toxic work culture, they’d ask Chairman Gruenberg to step down immediately. This draw-it-out strategy makes it clear that this administration is prioritizing their political agenda over protecting workers.”