Labor & Employment Law Daily Wrap Up, SENATE NEWS—Senators seek answers on FDIC OIG suspending workforce inquiry, (Sep 23, 2025)

By Jeff Williams

Senators Warren and Van Hollen said they were “disappointed” the effort was halted and asked the FDIC OIG to lay out a timeline for when it would resume.

Senator Elizabeth Warren (D-Mass.), the ranking member of the Banking, Housing, and Urban Affairs Committee, and Sen. Chris Van Hollen (D-Md.) have sent a letter to acting Federal Deposit Insurance Corporation Chairman Travis Hill and FDIC Inspector General Jennifer Fain expressing concerns and seek information regarding the FDIC Office of Inspector General’s “surprising” decision in June to suspend its work on the Succession Management and Employee Retention program Efforts project, instituted to analyze the effects of staff reductions at the agency.

“By diminishing the agency’s ability to adequately supervise banks and increasing the risk of bank failures, staffing shortages at the FDIC jeopardize stability and public trust in the nation’s banking system,” Warren and Van Hollen stated.

The senators asked for “assurances” that the FDIC OIG will "restart its examination of the FDIC’s succession management and employee retention practices, including the impact of severe Department of Government Efficiency ('DOGE') driven staff reductions at the agency.”

The FDIC OIC announced the suspension of the program in a June memorandum, saying that it was “prudent” to delay further work “in light of the evolving workforce landscape facing the Federal Government and the FDIC” (see Banking and Finance Law Daily, June 27, 2025).

Warren and Van Hollen noted that they and Sens. Raphael Warnock (D-Ga.) and Lisa Blunt Rochester (D-Del.) sent a letter to the FDIC OIG in February regarding whether Hill’s decision to rescind more than 200 job offers to bank examiners in response by President Trump’s call of a government-wide hiring freeze put the stability of the banking system in jeopardy (see Banking and Finance Law Daily, Feb. 12, 2025). In response, Warren and Van Hollen noted in their latest letter, the FDIC OIG said that the effects of the hiring freeze “remain to be seen” and that the office would analyze changes taking place at the FDIC.

Warren and Van Hollen noted that “[s]ince securing that commitment,” the FDIC has “executed additional staff reductions, increasing the importance and urgency of your review.” Those reductions include a 20 percent cut to the FDIC’s workforce, approximately 1,250 positions, they said, adding that there were "disappointed to see the FDIC OIG announce the suspension of further work on its review of the FDIC’s Succession Management and Employee Retention Efforts.”

The senators asked the FDIC to provide a response by Sept. 30, 2025, that includes a “timeline and/or estimate indicating when FDIC OIG plans to resume, and ultimately complete, work on the Succession Management and Employee Retention Efforts project.” and whether “any officials from the FDIC, White House, DOGE, or any other part of the Trump Administration” asked the office to suspend this review, and, if so, to explain any such interaction.

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