Federal Reserve Chair Jerome Powell is under a criminal inquiry tied to the renovation of the Fed’s headquarters, The New York Times reports. Powell denied the probe is about the renovation in a two-minute video, calling it retaliation for his refusal to lower interest rates. The investigation reportedly involved review of public statements and spending records, and grand jury subpoenas were served to the Fed.
DOJ Opens Criminal Investigation Into Fed Chair Jerome Powell — He Calls It Retaliation Over Interest-Rate Policy
Jerome Powell, Donald Trump
Federal Reserve Chair Jerome H. Powell is the subject of a criminal inquiry opened by the U.S. Attorney’s Office in the District of Columbia into the multi-year renovation of the Federal Reserve’s Washington headquarters and whether he misled Congress about the project’s scope, The New York Times reported.
Shortly before that report surfaced, Powell posted a two-minute video in which he denied the probe was genuinely about the renovation and said it was instead linked to his refusal to lower interest rates at the president’s request.
According to officials briefed on the matter and reported by The New York Times, the investigation includes a review of Powell’s public statements and spending records tied to the renovation. The report said the inquiry was in part driven by work led by Jeanine Pirro. The Justice Department also served the Federal Reserve with grand jury subpoenas on Friday seeking documents related to Powell’s testimony last year before the Senate Banking Committee.
Powell said: “This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings. . . . Those are pretexts. The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President.”
Powell framed the investigation as an attack on central bank independence, warning that it raises questions about whether monetary policy will continue to be set on the basis of evidence and economic conditions or instead be shaped by political pressure.
President Donald Trump has repeatedly criticized Powell for not cutting interest rates quickly, gave him the nickname “Too Late,” and in late December said he was considering suing Powell for “gross incompetence” over the renovation’s rising cost. Trump claimed the project’s cost could top $4 billion, about $1.5 billion above earlier projections.
This developing story centers on potential legal exposure tied to the renovation and a broader, politically charged debate over the independence of the Federal Reserve and the limits of oversight of its leadership.
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