WASHINGTON – Sen. John Kennedy (R-La.), a member of the Senate Banking Committee, penned this op-ed in The Hill calling for Federal Deposit Insurance Corporation (FDIC) Chair Martin Gruenberg to resign. Kennedy details the widespread allegations of sexual harassment at the FDIC, and he argues that Gruenberg must resign to allow a new leader to restore professionalism at the agency.

Key excerpts from Kennedy’s op-ed include:

“Reports of the conduct at the Federal Deposit Insurance Corporation (FDIC) read like a screenplay for ‘Animal House,’ the 1980s John Belushi movie about campus debauchery at the fictional Faber College. ‘Animal House’ is funny as hell. What’s not funny is finding out that some of the same behavior—and worse—may have been happening for years at one of the agencies charged with supervising America’s banking system.

“According to employees who spoke with the Wall Street Journal, the FDIC functioned as a real-life Faber College where excessive drinking, public urination and sexual harassment were common but professional consequences for this bad behavior were rare. Employees described booze-filled training conferences where trainees regularly ‘puked off the roof’ or drank so much they wound up in the hospital. (There’s no evidence of FDIC toga parties—yet.)”

 . . .

 “Since joining the FDIC’s board in 2005, Chairman Martin Gruenberg has had a front-row seat to it all. He was chair or acting chair of the FDIC for nine of the past 18 years while his agency apparently tolerated a culture of debauchery and harassment. Gruenberg either knew about the abuse women faced at the FDIC and failed to address it or was negligently blind to it.

 “Either way, Gruenberg should resign.”

. . . 

“If Gruenberg wants to show his employees and the American people—for the first time in his nearly two decades of leadership—that he is doing something to end abuse, he should resign and allow a real leader to restore professionalism to the FDIC. Right now, it's #MeToo—except for the connected at the FDIC.”

Read Kennedy’s full op-ed here.

Read Kennedy’s letter to Chair Gruenberg here.

WASHINGTON – Sen. John Kennedy (R-La.) joined Sen. Sherrod Brown (D-Ohio) in introducing the Close the Shadow Banking Loophole Act to close loopholes that would allow commercial companies to offer banking services without oversight from the Federal Reserve.   

“American consumers deserve confidence that our financial system is stable and accountable to protect consumers. Allowing companies to run their own big full-service banks without effective oversight puts individual Americans and the U.S. financial system at risk. I’m working to close the shadow banking loopholes that have left consumers vulnerable,” said Kennedy.

“Letting Big Tech and commercial companies operate banks without proper oversight will only open doors for predatory lending, invasions of consumer privacy, and broader financial instability. To protect consumers’ pocketbooks and ensure a strong banking system for Main Street, we need to ensure all banking institutions play by the same rules,” said Brown.

The Close the Shadow Banking Loophole Act would:

• Require a company that owns or controls an industrial loan company (ILC) to be subject to the same consolidated supervision by the Federal Reserve as any other bank holding company under the Bank Holding Company Act.

• Provide a carve-out for existing ILCs and allow the FDIC time to consider pending ILC applications.

• Prohibit the federal banking agencies from approving a change in control of an existing ILC unless its acquirer is subject to consolidated supervision by the Federal Reserve.

ILCs were established as small loan companies in 1910 to lend money to industrial workers. Over time, ILC powers have expanded, and non-bank companies can offer financial services without the same regulations and oversight as traditional banks. 

This loophole prevents federal regulators from examining the non-bank commercial holding company to determine the risks its non-bank operations pose to both the stability of the ILC and the financial system.

Non-bank commercial companies that seek to operate like banks through an ILC raise systemic financial stability, competition and consumer protection concerns. This bill would protect consumers and ensure the safety and soundness of the financial system by closing the ILC loophole. 

The full bill text is available here. 

WASHINGTON – The Senate and House have passed Sen. John Kennedy’s (R-La.) U.S. and Pacific Islands Forum Partnership Act as part of the annual National Defense Authorization Act. Kennedy’s legislation would combat Communist China’s aggression in the Indo-Pacific region by establishing a special envoy to the Pacific Islands Forum (PIF). 

“Beijing puts more economic and diplomatic pressure on the Pacific Island states each day, and America is out of time to talk about strategic solutions without implementing them. Congress has voted to take a clear, easy step to counter China’s communist antagonism by establishing a special envoy to the Pacific Islands Forum,” said Kennedy.

The bipartisan legislation includes 20 cosponsors, including lead co-sponsor Sen. Brian Schatz (D-Hawaii).

The PIF is an international organization of Australia, New Zealand and Pacific Island nations.

Communist China recognizes that these nations are strategically located in the Indo-Pacific region and has already established its own special envoy to the PIF. The U.S. took an equivalent diplomatic step by naming its own special envoy in Oct. 2022, but the position was not codified in law. With this bill, the position is now a permanent one that requires the Senate to confirm the special envoy role.

The role will elevate diplomacy in the region and have accountability to Congress. A special envoy would help answer a diversity of threats from the communist regime by deepening trust and increasing dialogue on the Pacific Islands’ economic, cyber security and military concerns.

Kennedy’s op-ed in Defense News is here.

Text of the legislation is available here.

WASHINGTON – Sen. John Kennedy (R-La.), a member of the Senate Judiciary Committee, today joined Sen. Tom Cotton (R-Ark.) in introducing a resolution to condemn the antisemitic phrase “from the river to the sea” and its derivations.

“The phrase ‘from the river to the sea’ is a call for genocide against Jewish people and to annihilate the state of Israel. The only appropriate response to that threat is to condemn it, and this resolution deserves unanimous support,” said Kennedy. 

In a recent Senate Judiciary Committee hearing, Federal Bureau of Investigation Director Christopher Wray stated that hate crimes and threats against Jewish Americans are increasing. 

Since the Oct. 7 Hamas terrorist attacks against Israeli civilians, reports of antisemitic incidents in the U.S. have increased 337%. Six college campuses, including Tulane University, are now under investigation by the U.S. Education Department after a rise in discrimination against Jewish students on campus.

“People who invoke this disgraceful, antisemitic slogan are calling for the mass murder of Jews, whether they know it or not. On October 7, the world saw the genocidal intent of the phrase, ‘From the River to the Sea.’ No one who uses this phrase should escape condemnation,” said Cotton. 

Background:

• At Tulane University, where approximately 43% of the student population is Jewish, pro-Palestine activists graffitied the slogan “from the river to the sea” on campus. 

• Demonstrators at Tulane University assaulted three Jewish students, breaking one student’s nose. 

• Kennedy spoke on the Senate floor about the Israel-Palestine conflict and condemned attacks against Jewish students in Louisiana.

Sens. Bill Hagerty (R-Tenn.), John Barrasso (R-Wyo.), Katie Britt (R-Ala.), Rick Scott (R-Fla.), Pete Ricketts (R-Neb.), Marco Rubio (R-Fla.), John Boozman (R-Ark.), Ted Budd (R-N.C.), Marsha Blackburn (R-Tenn.), Dan Sullivan (R-Alaska), Kevin Cramer (R-N.D.), John Thune (R-N.D.), Deb Fischer (R-Neb.), Lindsey Graham (R-S.C.), Tommy Tuberville (R-Ala.) and James Lankford (R-Okla.) also cosponsored the resolution.

The full text of the resolution is available here.