Justice Dept. drops probe into Federal Reserve and Jerome Powell

The Justice Department on Friday dropped a criminal investigation into the Federal Reserve and its leader, Chair Jerome Powell, regarding a renovation project at the central bank’s Washington headquarters.

“This morning the Inspector General for the Federal Reserve has been asked to scrutinize the building costs overruns – in the billions of dollars – that have been borne by taxpayers,” said U.S. Attorney for D.C. Jeanine Pirro in a post on X.

“Accordingly, I have directed my office to close our investigation as the IG undertakes this inquiry.”

Pirro added that she would “not hesitate to restart a criminal investigation should the facts warrant doing so.”

The Inspector General for the Federal Reserve has already reviewed the project twice, and found no wrongdoing. It was asked again to review the project in 2025 by Powell, amid unrelenting pressure from President Donald Trump and his top allies.

The decision clears the way for Trump’s nominee to chair the Fed, Kevin Warsh, to advance towards a confirmation vote in the Senate.

Warsh’s confirmation has been blocked by Senator Thom Tillis, R-N.C., since Trump tapped Warsh for the role, due to what Tillis called a “bogus” investigation of Powell.

Tillis and numerous other lawmakers have said it did not appear Powell committed any crime.

The Federal Reserve declined to comment on Pirro’s announcement.

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