Watchdog: Accountability

CFPB misses diversity mark, outside consultant says

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Congress,Watchdog,Richard Pollock,House of Representatives,CFPB,Whistleblowers,Accountability,Richard Cordray,Race and Diversity

Consumer Financial Protection Bureau officials praise workplace diversity and inclusion, but they don't practice it, according to a confidential personnel study obtained by the Washington Examiner.

The agency “primarily recruits and hires individuals with Ivy League backgrounds,” the study said. CFPB has about 1,300 full-time employees.

The bureau has a broken system with a lack of accountability for diversity that is “pervasive across CFPB,” the study said.

Those findings are included in the study done by Deloitte Consulting at the request of CFPB officials.

The study was given to CFPB officials last September, and has been seen by only a few of the bureau's senior leaders, according to testimony at a congressional hearing Wednesday.

CFPB has been previously criticized by one of its former investigators for maintaining a “toxic” workforce, discriminating against women and minorities and generating low morale among its employees.

On Monday, CFPB Director Richard Cordray abruptly scuttled the agency's proprietary employee performance rating system.

Many minority and female job applicants at CFPB may have “exceptional talent” indicated by their resumes, but they did not make it from the application process to “best qualified” due to a flawed CFPB review process.

The study was especially critical of CFPB for failing to be the model agency it promised to be in governance and in the fair treatment of its employees.

The study quoted a CFPB employee who said “the bureau thinks it’s diverse, but leadership thinks about it in an esoteric way. … It’s more of a hypothetical concept where they value it, but can’t demonstrate it.”

Another CFPB employee told the Deloitte researchers that “although CFPB leadership shows a strong understanding of diversity, inclusion has not yet materialized in the day-to-day experience of staff.”

Deloitte conducted 31 leadership interviews and three focus groups, each of 30 randomly sampled employees, examined employee survey data, Equal Employment Opportunity Commission complaint data and other workforce data.

Women, Hispanics and African-Americans are over-represented in “lower pay bands” and under-represented in the “higher pay bands,” according to the study.

There is ethnic diversity at lower pay grades, but it “begins to decrease significantly through mid-to-higher pay bands,” the study said.

Liza Strong, CFPB's director of employee and labor relations who handles employee grievances as second in command at its Office of Human Capital, told the House Financial Services subcommittee on oversight and investigations she has not seen the report.

“This is the first time you have been made aware of this report after eight months?” Rep. Ann Wagner, R-Mo., asked. “Yes,” Strong replied.

Similarly, Ben Konop, a CFPB enforcement attorney and executive vice president for the CFPB chapter of the National Treasury Employees Union, testified that he only saw the study for the first time Tuesday.

Konop got a copy of the study from the subcommittee, not from bureau officials.

In his email to employees on Monday about terminating the performance review system, Cordray said, "These differences indicate a systemic disadvantage to various categories of employees that persisted across divisions, offices, and other employee characteristics."

Konop, however, laid the blame for disparate performance ratings on the CFPB managers, not on the system.

“The managers were presumably the ones who made the ratings. I think there’s more than enough blame to go around but I believe managers deserve their fair share as well,” he said.

Strong and Konop offered starkly different Images of their agency, with Strong claiming, “I have not found any evidence of discrimination at the agency.”

Konop was asked if the Office of Human Capital and Strong in particular “are doing everything in their power to do address and resolve those specific workplace complaints as well as the underlying issue driving those complaints.”

“No,” he answered. He said the agency had more than 200 officials grievances, high for a small agency.

Last April, Misty Raucci, an outside consultant who investigated the whistleblower case of Angela Martin, a CFPB employee, described the agency with a “toxic” workplace in testimony before the House Financial Services Committee.

Martin told Congress at the same hearing the bureau had a "hostile environment” for its employees and there is retaliation against those who complain. She said that the consumer intake unit had so many minority employees it was derisively called “The Plantation.”

Strong told Rep. Sean Duffy, R-Wis., she had never heard of such problems at the consumer unit. “That was never reported to me.”

Konop said there were “extremely unhappy employees in consumer response unit" that “justified complaints and it seemed to revolve around race.”

Konop said there was a lot of “distrust” in the agency and that Strong and the Office of Human Capital "played a role in that. I felt the workers have not been getting a fair shake from Human Capital.”

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