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FDIC Workplace Report Reveals Harassment, Discrimination, and Abuse

The Federal Deposit Insurance Corporation, an independent federal agency, is the subject of a 234-page report on its workplace. The FDIC hired Cleary Gottlieb to investigate its culture after the Wall Street Journal published a report on widespread misconduct. The law firm interviewed around 500 out of the FDIC's 6,000 employees. In its report, the firm recommends new systems to protect employees, including a new hire to monitor the workplace, more training on workplace behavior, and better reporting avenues for employees.

Cleary Gottlieb's investigation shows a widespread and yearslong pattern of sexual harassment, discrimination, and abuse primarily of women and minority group members by senior officials. This workplace resulted from “a patriarchal, insular, risk-averse culture” and a “lack of clarity and credibility around internal reporting channels.” Each regional office is its own “fiefdom” where senior managers protect long-term employees from complaints by junior employees. The unacceptable behavior included senior examiners texting women pictures of their genitalia or taking them to brothels. Some employees recounted homophobic statements, including referring to gay men as “little girls.”

The report clearly states the agency's issues predate its current head, Martin Gruenberg. However, employees say Gruenberg is known for losing his temper and expressing anger at the staff, which "may hinder his ability to establish trust and confidence in leading meaningful culture change." Workers perceive Gruenberg as unwilling or unable to see that employees have experienced difficult interactions with him. Following the report's release, Gruenberg apologized for his shortcomings and said he accepted responsibility for workplace issues under his watch via a memo to all employees. Some politicians are calling for Gruenberg to step down.