Clarksville Times

On May 15, 2024, the House Financial Services Committee, under the leadership of Chairman Patrick McHenry (NC-10), held a hearing to conduct oversight of President Biden's prudential banking regulators. The committee scrutinized Federal Deposit Insurance Corporation (FDIC) Chair Martin Gruenberg following Cleary Gottlieb’s independent report confirming allegations of widespread misconduct and a toxic workplace culture at the agency during his tenure. Members also closely examined regulators’ Basel III Endgame proposal among other partisan regulatory initiatives.

Chairman McHenry addressed Mr. Gruenberg in his opening remarks, stating, “You have failed your employees, your agency, and the American people. The fact that you have yet to resign proves you take no responsibility for your actions. And let me be clear, showing up today is not an act of courage, it’s an act of hubris.”

McHenry continued by referring to a recent report outlining unacceptable behavior at the FDIC, including verbally abusive behavior attributed to Gruenberg. He asserted that deep institutional changes at the FDIC are necessary and emphasized that Gruenberg is not the right person to lead those changes.

The Chairman also cited President Biden's previous statement about disrespect in the workplace and asked his Democratic colleagues and the President if Gruenberg's behavior doesn't rise to that level, what does?

McHenry further highlighted that despite attempts by some colleagues to shift blame to Republican FDIC Chairs, it should be noted that Chair Gruenberg led the agency for 10 out of the last 13 years.

Discussing employee satisfaction surveys conducted annually at federal agencies, McHenry pointed out a decline in satisfaction during Gruenberg's tenure which saw a steep increase under former Chair McWilliams' leadership. However, upon Gruenberg's return as Chair, employee satisfaction plummeted once again.

Chairman McHenry concluded his remarks by criticizing the Biden administration’s banking regulators for pursuing partisan agendas rather than policies that support the economy, financial system, and American families. He also expressed concern over unresolved proposals following last year’s banking turmoil, most notably the Basel III Endgame proposal.