House Panel to Vote on Subpoenas for CFPB Employees

WASHINGTON — A House Financial Services subcommittee will hold a meeting Tuesday to authorize subpoenas against three officials at the Consumer Financial Protection Bureau who previously declined to testify about employee allegations of discrimination and retaliation.

The House Oversight and Investigations subcommittee announced the meeting late Thursday after the CFPB and its union declined to send three officials to testify at a April 2 panel hearing, saying it would undermine the credibility of the agency's grievance process. The hearing discussed the allegations of a CFPB employee, Angela Martin, and an outside investigator that looked into her case at the behest of the agency. Martin said her case was an indicator of widespread employee problems at the agency.

After the hearing, lawmakers from both political parties said they wanted to hear more from CFPB officials, while Richard Cordray, the agency's director, issued a statement saying he was willing to testify about broader concerns.

But Rep. Patrick McHenry, the subcommittee's chairman, and House Financial Services Committee Chairman Jeb Hensarling, said they still want to hear from three particular people they say are key to handling employee disputes.

"I wish Director Cordray would have allowed them to testify at our earlier hearing. Because he refused, the subcommittee has no other choice than to move forward with this action," said Hensarling in a press release.

The subpoenas seek testimony from Stacey Bach, the assistant director of the Office of Equal Employment Opportunity; Liza Strong, the director of Employee Relations; and Ben Konop, the executive vice president of the local chapter for the National Treasury Employees Union. The subcommittee had originally invited Robert Cauldwell, the president of the CFPB's local chapter to testify.

The CFPB previously declined to send Bach and Strong on the grounds that it would interfere with the confidential and ongoing employee grievance process. Reps. Maxine Waters, the top Democrat on the Financial Services Committee, and Al Green, the ranking member of the subcommittee, also want to hear from the CFPB but have launched a broader look at employee treatment at all the federal banking regulators. They have urged Republican leadership to focus on the broad concerns rather than individual whistleblowers.

In the announcement on Thursday evening, the subcommittee said the CFPB has refused to send Bach and Strong to testify while the NTEU will not send any CFPB union representative to testify. However, a CFPB spokeswoman said in an emailed response Friday that the agency previously authorized the named employees to speak in a closed session before the committee but the offer was declined.

"Discussions with the committee are ongoing," the spokeswoman, Jennifer Howard, said. "Director Cordray has told the committee that he welcomes the opportunity to appear before them and discuss these issues fully."

The subpoenas are meant for an upcoming hearing for a date yet to be announced, the subcommittee’s release said.

"As we continue our investigation into the claims of discrimination and retaliation at the CFPB, it is imperative that we are able to question Ms. Bach, Ms. Strong, and Mr. Konop," said McHenry, R-N.C., in the release. "Through our investigation, it has become quite clear to this committee that they are the three individuals with the most knowledge of the disturbing treatment which women and minority employees were subjected to while at the bureau."

The hearing was originally triggered by a March 6 story in American Banker that detailed racial disparities among the CFPB's employee evaluation process and discussed a number of grievances filed by employees that included allegations of a hostile work environment. The CFPB has since said it will change the evaluation process.

The subcommittee will hold the business meeting on the subpoenas at 2 p.m. Tuesday.