Government Watchdog Launches Probe into CFPB

The Government Accountability Office will conduct a review of the Consumer Financial Protection Bureau’s (CFPB) organizational culture and management practices in light of allegations that CFPB managers are discriminating against employees based on race and gender and retaliating against employees who complain.

The congressional watchdog agency’s review comes on the heels of a House of Representatives subcommittee’s investigation, ongoing since April, into CFPB employee practices.

During the subcommittee’s investigation, CFPB Examiner Ali Naraghi testified that he was a victim of retaliatory practices by several executive level agency employees. In one circumstance, Naraghi claimed bureau management had at one point referred to him as a “f’ing foreigner,” despite his being a naturalized U.S. citizen. 

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The GAO agreed to conduct the review during a hearing with CFPB Director Richard Cordray. The hearing was the subcommittee’s fourth since launching its probe into allegations of employment discrimination and retaliation at the CFPB.

So far, 32 employees have come forward about alleged maltreatment, said Rep. Patrick McHenry (R-NC), chair of the Financial Services Subcommittee on Oversight and Investigations, in a news release.

“These 32 brave leaders have come forward to do what is right: to protect their colleagues who suffer, and they have stood up even in the face of retribution from their managers if they are found out,” McHenry said. “Shortly, all CFPB employees will have an opportunity to confidentially share all of their concerns with the Government Accountability Office.” 

The GAO investigation was requested by Chairman McHenry as well as Financial Services Committee Chairman Jeb Hensarling (R-TX) and Financial Institutions and Consumer Credit Subcommittee Chairman Shelley Moore Capito (R-WV).

“The problem is a CFPB management culture that condones intimidation, discrimination, and retaliation,” McHenry said. “And if the director has failed to reprimand and remove bad managers, then the problem is also his leadership – or lack thereof.” 

Written by Cassandra Dowell

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