US Justice Department Halts Jerome Powell Probe, Senate Confirms Kevin Warsh
The US Justice Department has ceased its criminal investigation into Federal Reserve Chairman Jerome Powell concerning alleged building cost overruns. US Attorney Jeanine Pirro announced that the inquiry would instead be handled by the central bank's inspector general.
President Donald Trump has repeatedly criticised the cost of the Fed's building renovations, citing the sum as excessive amidst a protracted disagreement with Powell over interest rate policy. Powell's term is nearing its conclusion, and the US Senate is currently reviewing Trump's nominee, Kevin Warsh, for the position. Republican Senator Thom Tillis had publicly conditioned his support for Warsh's confirmation on the administration ending its investigation into Powell.
White House spokesman Kush Desai stated, "American taxpayers deserve answers about the Federal Reserve's fiscal mismanagement, and the Office of the Inspector General's more powerful authorities best position it to get to the bottom of the matter." Desai added, "The White House remains as confident as before that the Senate will swiftly confirm Kevin Warsh as the next Federal Reserve Chairman to finally restore competence and confidence in Fed decision-making."
Pirro, on social media, affirmed her readiness to "restart a criminal investigation should the facts warrant doing so." The Fed declined to offer comment. The inspector general's office confirmed it was "actively working to complete our review" and would make results public upon completion.
Last summer, Trump asserted the renovations would cost $3.1 billion, exceeding the Fed's $2.5 billion forecast. The Fed maintains these renovations, the first since the buildings' 1930s construction, will ultimately reduce long-term costs, addressing issues like asbestos and lead contamination.
Powell, nominated by Trump in 2017, took the unusual step in January of releasing a video disclosing that the Justice Department had issued subpoenas and threatened criminal indictment over his Senate testimony regarding the renovations. He described the investigation as "unprecedented" and suggested it stemmed from Trump's frustration with the Fed's refusal to lower interest rates, warning of political interference in central bank independence.
