Martin Gruenberg, chairman of the United States Federal Deposit Insurance Corporation (FDIC), will step down following a scathing investigation revealing a toxic workplace culture at the agency.
On May 20, Gruenberg announced his intention to resign from his position as chair, a role he has held since August 2005.
He stated in an email to staff, “In light of recent events, I am prepared to step down from my responsibilities once a successor is confirmed.
Until that time, I will continue to fulfill my responsibilities as Chairman of the FDIC, including the transformation of the FDIC’s workplace culture.”
The FDIC, an independent U.S. government agency, provides insurance for depositors in American commercial and savings banks.
The announcement follows a third-party investigation published on May 7, which uncovered allegations of sexual harassment and other misconduct at the FDIC, as well as the management’s inadequate response to these issues.
On May 15, Gruenberg testified before Congress regarding the widespread allegations of sexual harassment and mistreatment of subordinates.
Both Republicans and Democrats expressed their outrage and disbelief at the severity of the issues within the FDIC, as reported by Reuters.
Lawmakers, including Senate Banking Chair Sherrod Brown, have called for his resignation and urged President Biden to appoint a new FDIC chair.
The White House has confirmed its intention to nominate a successor for the position.
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However, Senator Elizabeth Warren expressed confidence in Gruenberg’s ability to initiate change at the agency.
Gruenberg’s impending resignation has been well-received by the crypto community. Nic Carter, a partner at Castle Island Ventures, celebrated the news, calling it “the best day ever.”
Meanwhile, digital asset industry lawyer John Deaton criticized Warren, saying, “It is shameful how Elizabeth Warren circled the wagons to keep one of her disgraced puppets in place. I’m so looking forward to the debates.”
Gruenberg is believed to have played a key role in Operation Choke Point 2.0, a term coined by Nic Carter in 2023.
This refers to a coordinated effort by the FDIC to discourage banks from holding crypto deposits or providing banking services to crypto firms.
In an October 2022 speech, Gruenberg compared crypto assets to risky financial innovations like subprime mortgages and collateralized debt obligations that contributed to the 2008 financial crisis.
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