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Subcommittee Subpoenas 3 in Investigation of Discrimination and Retaliation at CFPB

Washington, Apr 29 -

The House Financial Services Oversight and Investigations Subcommittee today voted to subpoena two CFPB officials and a union representative as part of the subcommittee’s ongoing investigation into allegations of discrimination and retaliation at the Bureau.

The CFPB and the National Treasury Employees Union (NTEU) did not allow the officials to appear as witnesses at a subcommittee hearing on April 2.  At that hearing, CFPB employee and whistleblower Angela Martin and Misty Raucci, an outside investigator hired by the CFPB, described a culture of racial and gender discrimination and retaliation against employees at the CFPB.

CFPB Director Richard Cordray refused to allow Stacey Bach, Assistant Director of the Office of Equal Employment Opportunity, and Liza Strong, Director of Employee Relations, to testify at the April 2 hearing.  A third official, Ben Konop, the executive vice president of the CFPB employees’ union, was also not allowed to testify by the union.  All three were subpoenaed today.

“Unfortunately, the CFPB and the NTEU refused to provide the requested witnesses to testify at the April 2 hearing.  And yet, we maintain it is imperative that we are able to question Ms. Bach, Ms. Strong, and Mr. Konop.  Through our investigation, it has become quite clear to this Subcommittee that they are the three individuals with the most knowledge of the disturbing treatment which women and minority employees were subjected to while at the Bureau,” said Oversight and Investigations Subcommittee Chairman Patrick McHenry (R-NC).

Bach and Strong have retained outside counsel to represent them in connection with the subcommittee’s investigation.

“It’s regrettable that Director Cordray refused to allow these CFPB officials to testify at the April 2 hearing about what they know of the Bureau’s hostile work environment and the retaliation by managers when employees dare to complain.  For the sake of Angela Martin and other CFPB employees who are suffering, our investigation will move forward.  All those engaged in this reprehensible behavior at the CFPB must be held accountable,” said Financial Services Committee Chairman Jeb Hensarling (R-TX).

Allegations that CFPB managers have engaged in discrimination and retaliation were chronicled in a March 6 article in the American Banker.  The article exposed serious personnel problems at the CFPB, including evidence that “the CFPB’s own managers have shown distinctly different patterns in how they rate employees of different races.”

According to “confidential agency data” reviewed by the American Banker, “CFPB managers show a pattern of ranking white employees distinctly better than minorities in performance reviews used to grant raises and issue bonuses. Overall, whites were twice as likely in 2013 to receive the agency’s top grade than were African-American or Hispanic employees.”

In addition to racial disparities in the CFPB’s performance reviews, the American Banker also reported that “[CFPB] management has been accused in several cases of favoring Caucasian men and of creating a hostile work environment.” The article noted that CFPB employees had filed 115 official grievances with the National Treasury Employees Union, which represents CFPB employees, and over 85 informal complaints pertaining to “allegations of unequal pay and raise questions about the recent performance reviews.”

Martin, the CFPB whistleblower who serves the CFPB as a senior enforcement attorney, told members of the subcommittee on April 2 that she is “a victim of discrimination by the Bureau dating back to May 2012, and I have suffered severe retaliation since December 2012 which continues through today.  Sadly, my story is not unique. My colleagues likewise have suffered and are suffering at the hands of inexperienced, unaccountable managers,” Martin said.