In a decisive move, the U.S. Federal Deposit Insurance Corporation’s governing board has appointed Cleary Gottlieb Steen & Hamilton, a distinguished law firm, to spearhead an independent investigation into allegations of sexual harassment and the prevailing workplace culture within the agency. This revelation was disclosed by the top bank regulator on Monday.
Renowned for their prior involvement in scrutinizing misconduct claims against former New York Governor Andrew Cuomo and the New York State Executive Chamber, Cleary Gottlieb brings a wealth of experience to this sensitive inquiry.
The decision to switch to Cleary Gottlieb comes in the wake of recent Wall Street Journal exposés, which shed light on the FDIC’s purported failure to eliminate a toxic and misogynistic work environment, resulting in the departure of female employees.
Replacing BakerHostetler, the previous choice for the review, Cleary Gottlieb assumes the mantle amid increasing scrutiny. BakerHostetler, the initial selection, has not issued a response to queries seeking comments.
The FDIC’s board established a two-member special committee last month following calls from Republican quarters for FDIC Chair Martin Gruenberg to recuse himself from overseeing the investigation. Republicans have been insistent on Gruenberg’s resignation, pledging an examination into the agency’s work culture. This determination was intensified by the Wall Street Journal’s reports, suggesting Gruenberg’s own alleged tendencies towards bullying and leniency in cases of workplace misconduct.
Martin Gruenberg, expressing personal concern over the allegations, has pledged to address them with utmost urgency. Leading the Cleary Gottlieb team is Joon Kim, a partner with a distinguished past as the acting U.S. Attorney for the Southern District of New York, alongside Jennifer Kennedy Park and Abena Mainoo.
“The Special Committee is unwavering in its commitment to a comprehensive and impartial review,” affirmed committee member Michael Hsu, who also serves as the acting comptroller of the currency and sits on the FDIC board. Jonathan McKernan, a Republican, joins Hsu as a fellow member of the special committee.
As the investigation unfolds, the spotlight remains on the FDIC, emphasizing the importance of accountability and transparency in the face of serious allegations.
