US lawmakers demand FDIC watchdog briefing on workplace culture

(Reuters) - Republican lawmakers on the House Financial Services Committee said Tuesday they were calling for an urgent briefing from a government watchdog to address reported allegations of pervasive sexual harassment at the Federal Deposit Insurance Corporation (FDIC).

The letter from Committee Chairman Patrick McHenry of North Carolina and others came a day after The Wall Street Journal reported female employees had left the FDIC due to "toxic" culture that the agency had long failed to address.

FDIC Chairman Martin Gruenberg was likely to face questioning on the matter during Congressional hearings with other top banking regulators this week, including a Wednesday appearance before the House Financial Services Committee.

"Reports allege that the agency maintains a culture that perpetuates sexual harassment, misogyny, and other acts of misconduct," the lawmakers wrote to Tyler Smith, the FDIC's acting inspector general, calling this a "severe departure" from the agency's mission.

The FDIC's performance has come under harsh scrutiny following a costly series of large bank failures earlier this year, two of which were supervised by the FDIC.

Gruenberg on Monday told staff the agency would not tolerate sexual harassment and announced that the agency had hired an outside law firm to review its internal practices.

The FDIC Office of Inspector General (OIG) reported in 2020 that the FDIC's efforts to prevent sexual harassment were inadequate. The OIG did not immediately respond to a request for comment on Tuesday but told Reuters on Monday that since the 2020 report, the FDIC had addressed all of its prior recommendations.

"As is our practice, we will continue to monitor management challenges at the FDIC as they are brought to the attention of the OIG, including matters related to sexual harassment," said FDIC Chief of Staff Jon Lebruto.

(Reporting by Douglas Gillison; Editing by Anna Driver)