Federal Reserve Chair Jerome Powell pushed back strongly after the DOJ opened a criminal probe into the Fed’s $2.5 billion headquarters renovation. In a rare video statement Powell said the subpoenas were "unprecedented" and suggested the investigation reflects political pressure related to disputes with President Trump over interest‑rate policy. The probe reviews public statements and spending records; other flashpoints include the firing of Fed Governor Lisa Cook and a public spat over renovation costs.
Powell Pushes Back After DOJ Opens Criminal Probe Into Fed Renovation
President Donald Trump visited the Fed's renovation project in July. / Getty Images
Federal Reserve Chair Jerome Powell issued a forceful response after federal prosecutors opened a criminal inquiry into the renovation of the Fed’s Washington headquarters and served grand jury subpoenas to the central bank.
In a rare video statement, Powell called the subpoenas "unprecedented" and framed the investigation as potential political pressure tied to disputes with President Donald Trump over interest-rate policy and the Fed’s independence.
“I have deep respect for the rule of law and for accountability in our democracy. No one—certainly not the chair of the Federal Reserve—is above the law,” Powell said. “But this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure.”
“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,” he added.
The Department of Justice probe—reported by The New York Times and led by the U.S. Attorney’s Office for the District of Columbia—includes a review of Powell’s public statements and an examination of spending records related to the Fed’s multi‑year renovation project.
Jerome Powell's term ends in May. / Saul Loeb/AFP via Getty Images
The Federal Reserve says the project is a $2.5 billion effort to modernize and preserve two historic buildings that have not been substantially updated since the 1930s. President Trump and administration officials publicly criticized the project as "ostentatious," and the president at one point suggested a $3.1 billion figure; the Fed says that higher number reflected separate costs for a previously completed building.
During a July site visit where Powell and Trump donned hard hats, the two sparred on camera over the budget. The dispute has since grown more political: Trump has repeatedly attacked Powell over the Fed’s policy choices and later moved forward with demolition of the 123‑year‑old East Wing to make room for a proposed 90,000‑square‑foot ballroom estimated to cost about $400 million.
The confrontation over the renovation comes amid other high‑profile clashes between the White House and the Fed. In August, the administration announced the termination of Fed Governor Lisa Cook; Cook responded by suing the president and Powell, calling the removal "unprecedented and illegal." Supreme Court arguments in Cook’s case are scheduled for Jan. 21.
Trump tried to fire Lisa Cook, but she swiftly put up a fight against the
Legal observers note uncertainty about how the Powell probe will fare in court. Last year, lawsuits against other officials were dismissed after a judge found procedural issues with the appointment of the U.S. attorney who filed those cases.
Despite the political attacks, some polls continue to show Powell with a higher public approval rating than the president. A December Gallup survey cited Powell at 44% approval versus 36% for Trump.
What’s next: The Justice Department has not publicly commented beyond confirming subpoena activity. The investigation’s scope, timeline and whether it will lead to charges remain uncertain.
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