FDIC Chairman Grilled Over Operation Choke Point
House Financial Services Oversight and Investigations Subcommittee Chairman Sean Duffy (R-Wis.), shown at left, grilled FDIC Chairman Martin Gruenberg on Operation Choke Point.
During the hearing, Duffy told Gruenberg he has no place in government if he does not fire or discipline the FDIC staffers who have enforced Operation Choke Point, which has targeted gun dealers and payday lenders.
The U.S. Department of Justice established Operation Choke Point to reduce fraud and reputational risk to financial institutions by pressuring them to refuse business from risky sectors.
“I am sure if you wanted to hold accountable those that were bad actors in the FDIC, you would. I don’t think you want to hold them accountable,” Duffy said during Tuesday’s hearing on the FDIC’s role in the initiative.
Duffy accused Gruenberg of hurting certain businesses that he personally opposes behind closed doors to avoid public debate.
“The bottom line is, you’re putting people out of business and all of the people in the FDIC who are implementing this program, they still work there. They haven’t been fired,” Duffy said. “They haven’t been reprimanded and you’re the chairman and frankly, I’ve got to tell you, if you’re not going to hold them accountable, I think the buck stops with you. I don’t think you should chair the FDIC.”
Duffy said if Gruenberg cannot hold those accountable who are targeting legal businesses then he should not be able to keep his position.
“You’ve known for two years that this is going on,” he said. “These folks have no place in government and if you allow them to stay you have no place in government,” he said.
In response, Gruenberg told the subcommittee the FDIC has consistently tried to respond to the lawmakers’ concerns.
“We cooperated with the investigation of the House Oversight Committee. We received the results of that investigation and the report and we then tried to take action,” he said.
Under a line of questioning from Emanuel Cleaver (D-Mo.), Gruenberg said he has not discussed Operation Choke Point with the White House.