The Chair of the FDIC is facing calls to resign after a scathing report. The implications for banks could be significant

Martin Gruenberg, the Chairman of the Federal Deposit Insurance Corporation is facing a barrage of calls from lawmakers to resign after a scathing 234-page report released Tuesday detailed pervasive sexual harassment, discriminiation and bullying at the agency.

Martin Gruenberg, the chair of the Federal Deposit Insurance Corporation, is facing a barrage of calls from lawmakers to resign after a scathing 234-page report released Tuesday detailed pervasive sexual harassment, discrimination and bullying at the agency. If he heeds the calls, there could be significant ramifications for banks across the country. The report, undertaken by the law firm Cleary Gottlieb Steen & Hamilton and commissioned by the FDIC, confirmed the findings of a November Wall Street Journal investigation revealing a long-standing problematic culture. It did not find that Gruenberg alone was responsible for the issues described in depth in the report based on interviews with over 500 employees. “We do recognize that, as a number of FDIC employees put it in talking about Chairman Gruenberg, culture ‘starts at the top,’” the report said. It also documented several instances where he lashed out at subordinates “particularly when being delivered bad news or conveyed views with which he disagrees.” That’s caused staffers to delay delivering news they fear would upset him. Gruenberg’s temperament “may hinder his ability to establish trust and confidence in leading meaningful culture change,” the report added. Gruenberg did not respond to a request for a comment. An FDIC spokesperson told CNN Gruenberg “is already implementing the recommendations in the report” and that “at his direction” the agency is “working to identify and appoint a transformation monitor as well as an independent third-party expert to support these efforts.”