DOJ opens criminal investigation into Fed Chair Powell

Powell disclosed the investigation himself. He said prosecutors are examining his June testimony before the Senate Banking Committee, where lawmakers questioned the renovation of two Federal Reserve buildings in Washington. The project has been estimated at about $2.5 billion, and authorities are also reviewing spending documents and public statements related to the work.

The allegations focus on whether Powell misled lawmakers about the scope of the renovation and specific “luxury” elements tied to earlier versions of the project. The issue has also drawn criticism over what opponents describe as inflated budgets and a potential corruption angle. Several politicians have said planning materials referenced reception areas, separate elevators, and a rooftop terrace with landscaping. In his June testimony, Powell disputed that characterization and said the final project does not include those features. Investigators are checking whether his descriptions matched the project documentation and how the plans changed as the budget increased.

Powell said the legal pressure is being used as a pretext to influence the Federal Reserve’s interest-rate decisions. He added that he will not follow Donald Trump’s wishes and intends to remain in office through the end of his term.

In Congress, Republican Sen. Thom Tillis criticized the Justice Department’s actions and said he would block confirmations of Federal Reserve nominees until the situation is clarified. Media reports have also said the investigation is being overseen by U.S. Attorney for the District of Columbia Jeanine Pirro.

Meanwhile, the White House is preparing for a leadership decision at the Fed after Powell’s term ends in May 2026. Donald Trump is interviewing candidates, and possible contenders mentioned in coverage include Kevin Warsh, Kevin Hassett, and Michelle Bowman.