Watchdog found Federal Housing Finance Agency Director Mel Watt's explanation of comments "not credible."

Watchdog found Federal Housing Finance Agency Director Mel Watt's explanation of comments "not credible." Jacquelyn Martin/AP

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Sexual Harassment by Former Housing Agency Chief Confirmed

Watchdog says now-retired Mel Watt likely propositioned female subordinate who complained.

Six weeks before he retired in January with full benefits, former Federal Housing Finance Agency Director Mel Watt was found by an inspector general to have engaged in the sexual harassment a subordinate employee complained about.

The Nov. 29 report submitted to the White House, lawmakers and the Office of Government Ethics was released only last week following a Freedom of Information Act request by The Washington Post. It is now on the IG’s website.

Watt, a former member of Congress, completed his term and left on schedule in early January, the agency confirmed to Government Executive, declining to discuss a “personnel issue” any further.

Watt was recorded making sexual overtures during business meetings by employee Simone Grimes, who had also complained that she was being paid less than a male employee doing the same job. Her attorneys in December had sent letters to the agency counsel demanding that Watt be removed and denied full retirement benefits.

“The inspector general’s report confirms that Mel Watt abused his power in pursuing a sexual relationship with Ms. Grimes, his employee,” co-counsel John Tye, of Whistleblower Aid, told Government Executive on Tuesday. “There must be consequences. FHFA should strip Mr. Watt of the government benefits he earned while committing this serious misconduct.”

The complainant Grimes herself said in an email to Government Executive: “Standing up for myself against the director of a Federal Agency of the U.S. government has not been an easy thing to do. I hope all of this will make future complaints against high powered officials easier for the next employee (male or female) that finds themselves in a similar position. The cost has been very high but it is necessary to change the culture in Public Service, which is lagging behind changes in the private sector.”  

The report signed by IG Laura Wertheimer concluded that Watt “misused his official position to obtain a personal benefit” and was not forthcoming during interviews.

The director “explained that his remark on the November 11, 2016, recording that he was ‘guilty of having an attraction’ to the [employee] meant only that he had ‘a friendship attraction’ as he did with ‘all [his] mentees,’ ” it said. “The director opined that there was nothing in the recording that was inconsistent with that meaning. He asserted that he has ‘told a number of [his] mentees that [he] think[s] they're gorgeous’ and that he has a ‘friendship attraction’ to them."

The IG found Watt’s “alternative explanation not credible.”

President Trump in December nominated Mark Calabria, chief economist to Vice President Mike Pence, to run the FHFA. As a senior aide on the Senate Banking Committee, he was one of the lead drafters of the 2008 Housing and Economic Recovery Act, which created the Federal Housing Finance Agency, the White House noted.

This story has been updated with a comment from the complainant