Senators allege partisanship and double standards in response to FDIC scandal

Republican and Democratic senators accused each other of partisan politics Thursday in their responses to reports of a toxic workplace culture at the Federal Deposit Insurance Corporation (FDIC).

While GOP lawmakers across the board have called on FDIC Chairman Martin Gruenberg (D) to resign, Democrats are divided over how to respond, with some urging Gruenberg to make changes in the agency instead of resigning.

Sen. Tim Scott (R-S.C.), who serves as the ranking member of the Senate Banking Committee, suggested Thursday during the panel's oversight hearing that the Biden administration has kept the FDIC chairman in place to advance its regulatory agenda.

The South Carolina Republican pointed to President Biden's decision to fire Martin Dickman, the inspector general of the US Railroad Retirement Board (RRB), in March for creating a hostile work environment.

“I can only conclude with one question: what makes you so different from the inspector general?” said Scott. “Is it political? Is it the fact that you are a necessary and convenient voice for the Biden administration's economic policy agenda? I think the answer is yes.”

If Gruenberg were to resign, he would be replaced by Republican FDIC Vice Chairman Travis Hill, he acknowledged Thursday in response to questions from Sen. Bill Hagerty (R-Tenn.).

“It is truly remarkable that anyone on this committee would be willing to ignore this report and what it so clearly requires, all because of a few rules at the Federal Reserve,” Hagerty said. “Does the 'Me Too' movement now have an exception for technical regulations?”

However, Sen. Elizabeth Warren (D-Mass.) hit back at her Republican colleagues, accusing them of engaging in “a purely political exercise” with their calls for Gruenberg's resignation.

“They want to replace you with Vice Chairman Travis Hill, who was the right-hand man of your Republican predecessor who allowed cultural problems to fester at the agency,” Warren said.

“Your resignation would do nothing to improve the toxic culture at the FDIC, but it would give Republicans a veto over bank policy,” she added.

Other Democrats, such as Rep. Maxine Waters (Calif.), ranking member of the House Financial Services Committee, have accused the law firm that recently investigated the FDIC of political bias, claiming it downplayed concerns and complaints raised among Republican leaders had emerged. of the agency in its final report.

The Cleary Gottlieb Steen & Hamilton report, released last week, confirmed allegations originally reported by The Wall Street Journal of a culture of sexual harassment, misconduct and retaliation at the banking regulator.

Sen. Laphonza Butler (D-Calif.) also accused Republicans at Thursday's hearing of “double standards” for their failure to denounce the actions of former President Trump, who is now the Republican Party's presumptive presidential nominee.

“I also expect that my colleagues on both sides of the aisle will be consistent in their commitment to investigating and holding perpetrators of sexual harassment and abuse accountable, whether they are serving at the FDIC or seeking to fill the Oval Office. ,” said Butler.

“It was interesting and a little confusing to listen to my colleagues mention the idea of ​​double standards, but also experience how they have not and will not address the behavior of the former President, who is not only in the courtroom today, but notes that he has already been found liable for sexual assault,” she added.

Trump has spent much of the past few weeks in court in New York City, where he is on trial for falsifying corporate records to conceal hush money payments to porn actor Stormy Daniels.

The former president was also found liable last year for sexually assaulting writer E. Jean Carroll during a meeting in the 1990s.

“It simply cannot be that this behavior is disgusting and unacceptable for the manager of the FDIC, but it is willfully ignored and therefore excused for someone who hopes to actually become the next President of the United States,” Butler continued. “What incredible hypocrisy.”

Sen. Steve Daines (R-Mont.) also suggested a double standard on the part of Democrats, questioning their commitment to combating sexual harassment and discrimination.

“I find it revealing that some of the same Senate Democrats who have tried to compromise their political identities in the fight against sexual harassment and discrimination sit here today and, quite frankly, turn a blind eye to the very same abuses taking place under your leadership. with the FDIC,” he said.

“It is clear that the president and his party would rather ignore these damning findings out of political expediency,” Daines added.

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