Banking regulator U.S. Federal Deposit Insurance Corporation (FDIC) failed to establish an effective system to deal with sexual harassment claims at the department, according to an investigation by the agency’s Office of Inspector General (OIG).
In the recent investigation, the watchdog looked at how the FDIC has dealt with sexual harassment allegations within its department over the past years.
“The FDIC, however, reported to the OIG that it had received only 34 allegations of sexual harassment since April 2019, indicating an underreporting of sexual harassment allegations at the FDIC.”
A higher share of employees were found to have remained silent about such instances compared to the previous survey from 2020.
“The reporting suggests that in most cases the allegations of harassment and discrimination were met with little to no disciplinary action on the part of the alleged perpetrators, creating an environment in which victims were made to continue working with their harassers,” the senators wrote in a Dec. 7 letter to Gruenberg.
The latest OIG report found that almost half of the respondents who either experienced or observed incidents of sexual harassment did not report these events due to fear of retaliation, up from over a third in the earlier survey.
Leadership Issues
The OIG found that FDIC leadership did not demonstrate “sufficient commitment” or accountability for an anti-harassment program.The FDIC does not have an effective system to track, address, and document allegations, the report stated. It has not set aside resources to tackle the issue. Supervisors and staff were not provided training on the matter.
The FDIC’s lack of an anti-harassment program is creating an “environment of distrust” among employees, with many workers afraid of reporting about harassment, according to the report.
The Epoch Times reached out to FDIC for comment.
The OIG made 24 recommendations to the FDIC to improve its anti-harassment initiatives. This includes providing the required resources to the anti-harassment program, implementing an effective system for reporting sexual harassment complaints, and providing workers with training on preventing such harassment.
The FDIC agreed to all the 24 recommendations, planning to complete the measures by March 31 next year.
While responding to a draft report submitted by the OIG, the FDI said in a June 29 letter that there was “no higher priority” for the agency than making sure that employees feel “safe, valued, and respected.”
“The chairman and senior FDIC executives are committed to providing an effective sexual harassment prevention program and to addressing workplace culture issues that have been reported since November of last year. The chairman and senior FDIC executives have established a number of initiatives for this purpose and have made meaningful progress toward implementing these measures.”
In a July 29 email sent to the OIG by the deputy to FDIC COO Daniel Bendler, which was shared with The Epoch Times, Bendler said that the organization has established a toll-free 24-hour hotline “to discreetly intake reports of harassing behavior” and assist impacted employees, along with counseling services and training programs to “prevent, recognize, and report sexual harassment,” as part of the initiatives.
“A Special Review Committee (SRC) to provide direction to and oversee an independent third-party review of the agency’s workplace culture,” said the letter. In addition, two extra offices have been created for investigating misconduct complaints, and reporting on discrimination and retaliation.
FDIC Scandal
In early May, law firm Cleary Gottlieb Steen & Hamilton released a 200-page report, ordered by the FDIC, which detailed the experiences of more than 500 employees who allegedly suffered sexual harassment, discrimination, and other similar conduct at the agency.“Those who reported expressed fear, sadness, and anger at what they had to endure … Many had never reported their experiences to anyone before, while others who had reported internally were left disappointed by the FDIC’s response.”
One employee revealed she feared for her safety after a co-worker repeatedly shared “unwelcome sexualized text messages that feature partially naked women engaging in sexual acts.”
Following the release of this report, Gruenberg announced on May 20 that he will resign once a suitable replacement is found.
Gruenberg defended himself in a statement while announcing his resignation, saying he has “faithfully carried out the critically important mission of the FDIC to maintain public confidence and stability in the banking system.”
Romero’s nomination is backed by Sen. Sherrod Brown (D-Ohio), who heads the Senate Banking Committee.
