Embattled Housing Finance Agency IG Steps Down

The Federal Housing Finance Agency inspector general told colleagues on Tuesday she planned to step down next month. Her announcement followed investigations from a federal watchdog and a pair of Republican senators that found a pattern of misconduct and abuse of authority, although she did not cite that as the reason for her departure. 

Laura Wertheimer was under fire from the Council of the Inspectors General on Integrity and Efficiency and Sens. Chuck Grassley, R-Iowa, and Ron Johnson, R-Wis., who sent letters to President Biden on April 14 and 28, respectively, about their separate investigations into top leadership at the FHFA IG office regarding whistleblower complaints starting in 2017. The issues were centered on Wertheimer, who was nominated by former President Obama and confirmed in 2014.

On Tuesday, Wertheimer said in a “dear colleagues” letter, shared with Government Executive, that she would step down after seven years on the job. “With the departure of [FHFA] Director [Mark] Calabria, I believe President Biden should have the opportunity to fill both the FHFA Director and IG positions with his own nominees,” she wrote. “For that reason, I am writing to let you know that I have made the decision to leave this position, effective July 30, 2021. When I joined FHFA-OIG, I had no intention of staying for seven years but found that OIG is a place where one’s service can make a real difference in protecting the interests of American taxpayers.”

Following a Supreme Court ruling last Wednesday that deemed the FHFA’s structure unconstitutional, President Biden ousted Calabria. 

In her letter, Wertheimer recapped the office’s accomplishments under her watch. “Although the pandemic forced us to close our physical offices in March 2020, we were telework-ready and able to continue our mission of conducting oversight to improve the effectiveness and efficiency of FHFA’s programs and operations and to prevent and detect fraud, waste and abuse,” she wrote. “Investments in our information infrastructure, advance planning, and the dedication of our support staff enabled us to transition, seamlessly, to telework collaboratively and securely. And as our country begins to emerge from this pandemic, FHFA-OIG has not missed a beat in fulfilling its mission.” 

The CIGIE report on Wertheimer’s leadership painted a far different picture. “The [Integrity Committee] finds by a preponderance of evidence that IG Wertheimer abused her authority in the exercise of her official duties and engaged in conduct that undermines the integrity reasonably expected of an IG,” wrote committee chair Kevin Winters in the April letter. She “showed a disdain and resistance towards congressional and IC oversight by fostering a culture of witness intimidation through a pattern of staff abuse and fear of retaliation. Furthermore, she wrongfully refused to cooperate with the IC’s investigation by denying the IC investigators full access to FHFA OIG personnel and documents.” CIGIE recommended her removal. 

Sens. Chuck Grassley, R-Iowa, and Ron Johnson, R-Wisc., also called for Wertheimer’s removal. 

Emmet Flood, an attorney at Williams & Connolly LLP who is representing Wertheimer, previously told Government Executive in a statement, Wertheimer “has been a superlative IG and members of her oversight committee have commended her for her frankness, courage and service,” nothing that she and her staff won the 2019 CIGIE Government Ethics Award for Excellence. “Anyone with an interest in her performance as IG can consult the FHFA-OIG website, where the record of her team’s accomplishments is public, extensive and incontestable.” The 2019 award was for the team’s investigation into allegations of misconduct by the then-FHFA director. 

Jennifer Byrne, associate FHFA IG, lauded the outgoing IG in a statement.

“I joined FHFA-OIG after a career of more than twenty years with other government agencies," she said. "Laura Wertheimer’s leadership, intellect and work ethic transformed FHFA-OIG. The numbers tell the story. She not only produced award-winning results while increasing efficiency and reducing costs, she did so while significantly improving employee retention. Her wisdom, integrity, and judgment will be sorely missed by her colleagues who have worked closely with her for many years.”

Update: This article has been updated with comment from the associate FHFA IG.