Powell

The announcement on Friday is expected to clear the path for the confirmation of his successor, Kevin Warsh.

The United States Department of Justice has ended its probe into US Federal Reserve chair Jerome Powell, clearing a major roadblock to the confirmation of his successor, Kevin Warsh.

US Attorney for the District of Columbia Jeannine Pirro said on X on Friday that her office was ending its probe into the Fed’s extensive building renovations because the Fed’s inspector general would scrutinise them instead.

Pirro, a Trump ally and the top federal prosecutor in Washington, DC, said she had instead asked the Fed’s internal watchdog, the Office of Inspector General, to examine cost overruns in renovations of the central bank’s Washington headquarters.

“The IG has the authority to hold the Federal Reserve accountable to American taxpayers,” Pirro said in a social media post. “I expect a comprehensive report in short order and am confident the outcome will assist in resolving, once and for all, the questions that led this office to issue subpoenas.”

The move could lead to a swift confirmation vote by the Senate for Warsh, a former top Fed official whom US President Donald Trump, a Republican, nominated in January to replace Powell. Powell’s term as chair ends May 15.

Senator Thom Tillis, a North Carolina Republican, had said he would oppose Warsh until the investigation was resolved, effectively blocking his confirmation.

The leadership transition at the world’s leading central bank could now proceed quickly.

Republicans praised Warsh during a Tuesday hearing even as Democrats questioned his independence from Trump, the lack of transparency around some of his financial holdings, and what they said was his flip-flopping on interest rates. Senator Elizabeth Warren of Massachusetts, the ranking Democrat on the committee, questioned if Warsh will be a “sock puppet“.

Still, Trump’s previous appointment to the Fed’s board of governors, Stephen Miran, was approved by the full Senate just 13 days after his nomination.

No evidence

The investigation was among several undertaken by the Department of Justice into Trump’s perceived adversaries. For months, it had failed to gain traction as prosecutors struggled to articulate a basis to suspect criminal conduct.

A prosecutor handling the case conceded at a closed-door court hearing in March that the government had not yet found any evidence of a crime, and a judge subsequently quashed subpoenas issued to the Federal Reserve.

The judge, James Boasberg, said prosecutors had produced “essentially zero evidence” to suspect Powell of a crime. Boasberg branded prosecutors’ justification for the subpoenas as “thin and unsubstantiated”.

More recently, prosecutors made an unannounced visit to a construction site at the Fed’s headquarters but were turned away, drawing a rebuke from a defence lawyer in the case who called the manoeuvre “not appropriate”.

Warsh said during the Senate hearing on Tuesday that he never promised the White House that he would cut interest rates, even as the president renewed his calls for the central bank to do so.

“The president never once asked me to commit to any particular interest rate decision, period,” Warsh said during the hearing. “Nor would I ever agree to do so if he had … I will be an independent actor if confirmed as chair of the Federal Reserve.”

Warsh’s comments came just hours after Trump, in an interview on CNBC, was asked if he would be disappointed if Warsh did not immediately cut rates and responded, “I would.”

The decision to abandon the investigation represents a rare pullback for a Department of Justice that over the last year has moved aggressively, albeit unsuccessfully, to prosecute public figures the president does not like.

Robert Hur, an lawyer for the Federal Reserve Board of Governors, did not immediately respond on Friday to an email seeking comment.

WASHINGTON — The Justice Department has ended its probe into Federal Reserve chair Jerome Powell, clearing a major roadblock to the confirmation of his successor, Kevin Warsh.

U.S. Attorney for the District of Columbia Jeannine Pirro said on X that her office was ending its probe into the Fed’s extensive building renovations because the Fed’s Inspector General would scrutinize them instead.

The decision ends an investigation, one of several undertaken by the Justice Department into President Trump’s perceived adversaries, that for months had failed to gain traction as prosecutors struggled to articulate a basis to suspect criminal conduct.

A prosecutor handling the case conceded at a closed-door court hearing in March that the government hadn’t yet found any evidence of a crime, and a judge subsequently quashed subpoenas issued to the Federal Reserve. The judge, James Boasberg, said prosecutors had produced “essentially zero evidence” to suspect Powell of a crime. Boasberg prosecutors’ justification for the subpoenas as “thin and unsubstantiated.”

More recently, prosecutors made an unannounced visit to a construction site at the Fed’s headquarters but were turned away, drawing a rebuke from a defense attorney in the case who called the maneuver “not appropriate.”

The move could lead to a swift confirmation vote by the Senate for Warsh, a former top Fed official whom Trump, a Republican, nominated in January to replace Powell, whose term as chair ends May 15. Sen. Thom Tillis, a North Carolina Republican, has said he would oppose Warsh until the investigation was resolved, effectively blocking his confirmation.

Warsh said Tuesday that he never promised the White House that he would cut interest rates, even as the president renewed his calls for the central bank to do so.

“The president never once asked me to commit to any particular interest rate decision, period,” Kevin Warsh, a former top Fed official, said under questioning by the Senate Banking Committee. “Nor would I ever agree to do so if he had. … I will be an independent actor if confirmed as chair of the Federal Reserve.”

Warsh’s comments came just hours after Trump, in an interview on CNBC, was asked if he would be disappointed if Warsh didn’t immediately cut rates and responded, “I would.”

April 22 (UPI) — Federal Reserve Chairman Jerome Powell‘s term is nearing its end and President Donald Trump is pushing for his replacement but an investigation into Powell may hold up the appointment of a new chair.

The Justice Department opened an investigation into Powell over the renovation of the Marriner S. Eccles Federal Reserve Board Building in Washington, D.C., which Trump claims has exceeded $3 billion. The renovation was not the beginning of Trump’s feud with Powell but it has added to his effort to oust the chairman before the end of his term.

Powell’s term as chairman of the Federal Reserve will end in May but he will remain on the Board of Governors until January 2028.

Typically when a Fed chair’s term ends, they resign. However, Powell said he plans to stay put until a replacement is appointed.

At least one lawmaker, Sen. Thom Tillis, R-N.C., said he would not vote on a new chairman until the investigation into Powell is over.

The Justice Department alleges that Powell made false or misleading statements to Congress about the cost of the renovation project at the Federal Reserve headquarters during his testimony to the House Committee on Financial Services in June.

Powell’s testimony was part of his semiannual report to Congress on monetary policy.

Following the hearing, Rep. Anna Paulina Luna, R-Fla., submitted a request to then-Attorney General Pam Bondi for Powell to be investigated for perjury and making false statements. Luna said that Powell denied there would be “luxury features” included in the renovations, including a “VIP dining room, premium marble, water features and a roof terrace garden.”

Luna added that Powell “falsely claimed that the Eccles building ‘never had’ a serious renovation.” She notes that the building underwent renovations in 1999 and 2003.

“These are not minor misstatements,” Luna said. “Chairman Powell knowingly misled both Congress and executive branch officials about the true nature of a taxpayer-funded project. Lying under oath is a serious offense — especially from someone tasked with overseeing our monetary system and public trust.”

No charges have been formally filed against Powell. The challenge the Justice Department faces in convicting Powell of perjury or false statements is in proving that he willfully, knowingly made statements he knew to be false at the time.

Powell, who was Trump’s nominee for chairman in 2017, has said that the investigation into him and the Federal Reserve renovation is “pretext” to punish him for not following Trump’s direction to lower interest rates.

“No one, certainly not the chair of the Federal Reserve, is above the law, but this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure,” Powell said in a video message in January. “This is about whether the Feed will be able to continue to set interest rates based on evidence and economic conditions — or whether instead monetary policy will be directed by political pressure or intimidation.”

Last month, federal prosecutor George A. Massucco-LaTaif told Chief U.S. District Judge James E. Boasberg that the Justice Department does not know of any evidence that a crime has been committed in the Federal Reserve renovation project.

“We do not know at this time,” Massucco-LaTaif said. “However, there are 1.2 billion reasons for us to look into it.”

The fissure between Powell and Trump began and has continued over the Federal Reserve’s decision to maintain elevated interest rates in response to inflation. Trump has repeatedly called on the Federal Reserve to lower interest rates, saying the United States should “have the lowest interest rate in the world.”

All along the Federal Reserve continues to hold an elevated interest rate, currently between 3.5% and 3.75%, in an effort to tame inflation. Its target rate of inflation is 2% on an annual basis.

Economic markers from the U.S. Bureau of Labor statistics show the rate of inflation remains at about 3%.

Trump has nominated Kevin Warsh to succeed Powell. Warsh served on the Fed’s board for five years after being appointed by President George W. Bush in 2006.

“I have known Kevin for a long period of time, and have no doubt that he will go down as one of the great Fed chairmen, maybe the best,” Trump posted on social media in January. “On top of everything else, he is ‘central casting,’ and he will never let you down.”

Warsh faced his first hearing on the path toward confirmation on Tuesday when he testified before the Senate Banking Committee. Questions by senators centered on the Federal Reserve’s independence, something Trump’s influence has called into question.

If appointed, Warsh would be the wealthiest person to lead the Federal Reserve.

Presidents have butted heads with the Federal Reserve throughout its history, as monetary policy can reflect on how the U.S. population views the president’s performance. A president has never tried to fire the chairman of the Federal Reserve.

The Federal Reserve is a non-partisan, independent agency made up of a board of governors posted in Washington, D.C., and 12 regional banks located across the United States.

Independence is key to the Federal Reserve’s function, keeping it from choosing policy based on the political goals of those occupying the White House and other branches of government.

Trump has not attempted to fire Powell yet but he did attempt to fire Fed board Gov. Lisa Cook. The attempt was unsuccessful as the U.S. Supreme Court intervened in October and ruled that she can remain at her post on an interim basis, at least for 2026.

The president does have some authority over choosing or designating a new Federal Reserve chair, Peter Shane, a constitutional law scholar in residence at NYU Law School, told UPI. However, a president must demonstrate a good reason for doing so.

There are two mechanisms in place that are meant to protect the independence of the Federal Reserve and its chair from political influence.

First, there is Supreme Court precedent. In 1935, the high court made a ruling in the landmark case Humphrey’s Executor vs. the United States. In this case, the court ruled that President Franklin D. Roosevelt could not fire the commissioner of the Federal Trade Commission, another independent agency, without cause.

The ruling affirmed that the authority to remove the head of any independent agency falls to Congress.

Second, there is the Federal Reserve Act. President Woodrow Wilson signed the Federal Reserve Act of 1913 to decentralize the control over monetary policy in the United States. This established the Federal Reserve and set its independence as a foundational feature of its existence.

The Federal Reserve Act makes the Federal Reserve independent in setting monetary policy without the influence of the president or Congress.

Congress has the ability to change the Federal Reserve Act. It did so in 1977 with the Federal Reserve Reform Act.

This amendment, signed into law by President Jimmy Carter, codified the objectives of the agency and established a requirement for the board of governors to report to Congress in hearings twice a year. It also added the requirement of Senate confirmation hearings for the chairman and vice chairman of the board of governors.

Last year, Rep. Thomas Massie, R-Ky., introduced the Federal Reserve Board Abolition Act, calling for the board of governors of the Federal Reserve and all Federal Reserve banks to be abolished.

“Americans have suffered under crippling inflation and the Federal Reserve is to blame,” Massie said in a statement.

Since being introduced in March 2025 the bill has not progressed beyond being referred to the House Committee on Financial Services.

WASHINGTON — Federal prosecutors made an unannounced visit this week to a construction site at Federal Reserve headquarters that is the focus of an investigation into a $2.5-billion renovation project, according to two people familiar with the visit.

Two prosecutors and an investigator from U.S. Atty. Jeanine Pirro’s office were turned away on Tuesday by a building contractor and referred to Fed attorneys, one of the people said. The two people familiar with the visit spoke on condition of anonymity because they weren’t authorized to publicly discuss an ongoing investigation.

The visit underscores that the Trump administration is not backing down from its investigation of the Fed and its chair, Jerome Powell, even though the probe has delayed the confirmation of a new chair nominated by President Trump. The investigation is focused on cost overruns and brief testimony about the project last summer by Powell. Trump confirmed in an interview that aired Wednesday on Fox Business that he wants to continue the probe.

Last month, during a closed-door hearing before a federal judge, a top deputy from Pirro’s office conceded that they hadn’t found any evidence of a crime in their investigation of the headquarters project.

Robert Hur, an attorney for the Federal Reserve board of governors, sent an email to Pirro’s prosecutors about their visit and their request for a “tour” to “check on progress” at the construction site. Hur’s email, which the Associated Press has viewed, noted that U.S. District Judge James Boasberg concluded that their interest in the Federal Reserve’s renovation project was “pretextual.”

“Should you wish to challenge that finding, the courts provide an avenue for you; it is not appropriate for you to try to circumvent it,” Hur wrote.

Republican Tillis is key vote

Sen. Thom Tillis, a North Carolina Republican who is a key member of the Senate Banking Committee, has vowed to vote against Kevin Warsh, Trump’s nominee to replace Powell as Fed chair, until the investigation is dropped. With the committee closely divided on partisan lines, Tillis’ opposition is enough to block Warsh.

The Banking panel said Tuesday that it will hold a hearing on Warsh’s nomination April 21. Powell’s term as Fed chair ends May 15, but Powell said last month he would remain as chair until a replacement is named.

Powell is serving a separate term as a member of the Fed’s governing board that lasts until January 2028. Chairs typically leave their posts as governor when their terms as chair end, but they can remain on the board if they choose.

Last month, Powell said, “I have no intention of leaving the Board until the investigation is well and truly over, with transparency and finality.” If he remains in his seat, even after Warsh is confirmed, it would deny Trump the oppotunity to fill a seat on the seven-member board.

Late Tuesday, Tillis posted a link on social media to the Wall Street Journal’s article on the visit below an image of the Three Stooges and wrote, “The U.S. Attorney’s Office for D.C. at the crime scene.”

Investigation centers on building renovations

The investigation by Pirro’s office centers on an appearance by Powell before the Senate Banking Committee last June, when he was asked about cost overruns on the Fed’s extensive building renovations. The most recent estimates from the Fed suggest the current estimated cost of $2.5 billion is about $600 million higher than a 2022 estimate of $1.9 billion.

“It is probably corrupt, but what it really is, is incompetent,” Trump said on Fox Business. “Don’t you think we have to find out what happened there?”

The president’s support for the investigation threatens a time frame set out by Sen. Tim Scott, a South Carolina Republican who chairs the Banking Committee. Scott said Tuesday on Fox Business that he believed the investigation would be “wrapped up in the next few weeks,” allowing Warsh to be confirmed soon after.

Threat to fire Powell

News of the unannounced visit by prosecutors comes as Trump has again threatened to fire Powell, if the Federal Reserve chair decides to stay on the central bank’s governing board after his term as chair expires next month.

“Well then I’ll have to fire him, OK?” Trump said when reminded that Powell has said he won’t leave the Fed while the Justice Department investigates a $2.5-billion renovation project at the bank. Powell has also said he will remain as chair of the Fed’s rate-setting committee until a replacement is confirmed by the Senate, following the precedent of previous chairs.

Trump has for months wanted to remove Powell as chair of the Fed, saying he has been too slow in orchestrating interest rate cuts that would give the U.S. economy a quick boost. Powell has said the investigation is a pretext to undermine the Fed’s independence to set rates.

Supreme Court weighing another Trump removal

Trump’s threat to fire Powell comes as the Supreme Court is weighing the president’s effort to remove another central bank governor, Lisa Cook. Lower courts have so far allowed Cook to remain in her job while her legal challenge to the firing continues. The Supreme Court also seemed likely to keep her on the Fed when the court heard arguments in January. A decision could come any time.

The issue in Cook’s case is whether allegations of mortgage fraud, which she has denied, is a sufficient reason to fire her or a mere pretext masking Trump’s desire to exert more control over U.S. interest rate policy.

The Supreme Court has allowed the firings of the heads of other governmental agencies at the president’s discretion, with no claim that they did anything wrong, while also signaling that it is approaching the independence of the nation’s central bank more cautiously, calling the Fed “a uniquely structured, quasi-private entity.”

Kunzelman and Rugaber write for the Associated Press. AP Writer Mark Sherman contributed to this report.

April 15 (UPI) — President Donald Trump again threatened to fire Federal Reserve Chair Jerome Powell if he doesn’t step down from his position in May.

“Then I’ll have to fire him,” the president said on Fox Business. “If he’s not leaving on time — I’ve held back firing him. I’ve wanted to fire him, but I hate to be controversial. I want to be uncontroversial.”

Powell’s term as chair ends on May 15 and Trump does not have the authority to fire him without cause. But his nominated replacement, Kevin Warsh, hasn’t been confirmed by the Senate. If he doesn’t get confirmed, Powell could stay on as chair pro tempore.

“That’s what the law calls for. That’s what we’ve done on several occasions,” Powell said.

He said he plans to stay on the board.

“I have no intention of leaving the board until the investigation is well and truly over with transparency and finality,” Powell said.

The Senate Banking Committee is scheduled to have hearings on Warsh’s nomination on April 21.

Powell’s term as a Fed governor goes until 2028, but he said he hasn’t decided if he’ll serve out that term.

Complicating matters, the Trump administration has been trying to prosecute Powell for his role in the $2.5 billion renovation of the Fed headquarters. The building went far over budget, and Trump has implied that something illegal is happening.

U.S. attorney for the District of Columbia Jeanine Pirro tried to subpoena Powell over the renovation, but a judge denied it. Pirro admitted she had no evidence.

Sen. Thom Tillis, R-S.C., who is on the Senate Banking Committee, said he will continue to block Warsh’s confirmation until the investigation into Powell ends.

But Trump said he isn’t worried about Tillis.

Tillis “is an American; he knows what to do,” he said.

Trump said the investigation must happen.

“What they’ve done to that, so it is probably corrupt, but what it really is is incompetent, and we have to show the incompetence of that,” he said.

Trump has wanted Powell out of the Fed since he was elected to office for the second term. He has said he wants interest rates dropped, but Powell has taken a more conservative approach. Powell has lowered the rates, but not fast enough for the president.

“Does that mean we stop a probe of a building that I would have done for $25 million that’s going to cost maybe $4 billion? Don’t you think we have to find out what happened there?” Trump said in the interview at the White House. “I have to find out.”

He called Powell “a disaster.”

“Here’s a man who took this little, tiny building and a couple of other little, tiny complex, and he’s spending more than $3 billion. I want to know who the contractor is, because that contractor is making billions of dollars, perhaps.”

The Fed said the building’s cost overruns are due to “unforeseen conditions” requiring more spending, including “more asbestos than anticipated, toxic contamination in soil, and a higher-than-expected water table.”

Trump has also tried to oust Fed governor Lisa Cook on the allegation that she committed mortgage fraud.

A United States federal judge has once again batted down a pair of subpoenas from the administration of President Donald Trump seeking information about Jerome Powell, the chairman of the Federal Reserve, the country’s central bank.

In a brief, six-page opinion published on Friday, Judge James Boasberg rejected the Department of Justice’s motion to reconsider his earlier ruling rejecting the subpoenas.

“The Government’s arguments do not come close to convincing the Court that a different outcome is warranted,” Boasberg wrote.

On March 13, Boasberg, a judge for the federal court in the District of Columbia, nullified the subpoenas on the basis that they were issued for an “improper purpose”: to pressure Powell into compliance with the president’s demands.

Trump and Powell — an appointee from the president’s first term — have been at loggerheads since the Republican leader returned to the White House in January 2025.

Although the Federal Reserve is an independent government agency, not subject to political demands, Trump has repeatedly called on the bank to slash interest rates, and he has denounced Powell as “incompetent”, “crooked” and a “fool” for not following suit.

For months, pressure had been building from the Trump White House to investigate Powell and push him prematurely from his job as Federal Reserve chair. Powell’s term is slated to expire in May.

Much of the Trump administration’s focus has fallen on renovations to the Federal Reserve’s historic 1930s buildings in Washington, DC, which have gone over budget.

The administration has pointed to the cost overruns as evidence of malfeasance.

Last July, for instance, Trump appointee William Pulte called on Congress to investigate Powell for “political bias” and “deceptive” testimony related to the renovation project.

The following month, Trump posted on his platform Truth Social that he was considering “a major lawsuit against Powell” in response to “horrible, and grossly incompetent” work on the renovations.

The pressure reached a climax on January 11, when Powell made a rare statement announcing he was under a Justice Department investigation over the renovation project. He dismissed the probe as a “pretext” to undermine the Federal Reserve’s leadership over monetary policy.

“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 said.

The Federal Reserve has since sought to have the subpoenas into Powell’s behaviour tossed.

Boasberg sided with the central bank in his initial ruling, and in Friday’s opinion, he called the Trump administration’s efforts to change his mind insufficient.

The Justice Department had argued that it does not need to produce evidence of a crime to seek a grand jury subpoena.

Boasberg agreed with that point, but he said subpoenas were also subject to a legal standard that bars them from being issued for “improper” purposes.

“The subpoena power ‘is not unlimited’ and may not be abused,” Boasberg wrote, citing court precedent.

He therefore ruled that the lack of evidence overall against Powell was relevant to the legality of the subpoenas.

“The controlling legal question is what these ‘subpoena[s’] dominant purpose’ is: pressuring Powell to lower rates or resign, or pursuing a legitimate investigation opened because the facts suggested wrongdoing,” Boasberg said.

“Resolving that question requires probing whether the Government’s asserted basis for the subpoenas — suspicions of fraud and lying to Congress — is colorable or tenuous. That inquiry, in turn, means asking how much evidence there is to back up the Government’s assertions.”

Boasberg underscored that he has seen no suggestion that Powell committed criminal wrongdoing and pointed to the long list of statements Trump has made attacking the Federal Reserve chair, suggesting an ulterior motive.

“The Government’s fundamental problem is that it has presented no evidence whatsoever of fraud,” he concluded.

Friday’s ruling is likely to set the stage for the Trump administration to appeal. US Attorney Jeanine Pirro has previously denied any political motivation for the investigation.

She has also asserted that Boasberg is “without legal authority” to nullify the subpoenas.

March 13 (UPI) — A federal judge this week quashed subpoenas the Department of Justice had issued to Federal Reserve Chair Jerome Powell because they were issued to pressure him into adjusting interest rates.

Judge James Boasberg redressed the DOJ for the subpoenas, saying that their purpose had nothing to do with a probe about renovations at the Federal Reserve in Washington, D.C.

The DOJ in January launched a criminal investigation into Powell’s testimony last year about the renovations, which Powell at the time said were “pretexts” to punish him and the Fed after they did not set interest rates at levels demanded by President Donald Trump.

“The Government has produced essentially zero evidence to suspect Chair Powell of a crime; indeed, its justifications are so thin and unsubstantiated that the Court can only conclude that they are pretextual,” Boasberg wrote in the opinion.

The department in January issued grand jury subpoenas in reference to Powell’s comments about the multi-year project to renovate the Fed’s office buildings during his June 2025 testimony before the Senate Banking Committee.

During a tour of the renovations, Powell disputed Trump’s over-estimates of the renovation’s cost, and threatened to sue him for the “horrible and grossly incompetent job” Powell had done on the project.

Overall, however, Trump has repeatedly ripped into and mused about firing Powell, which he cannot do, because the Fed chair has repeatedly said that interest rate changes would be dictated by only the market, rather than the preferences of any one person.

In the opinion, which was unsealed Friday, Boasberg said he blocked the subpoenas because “a mountain of evidence suggests that the Government served these subpoenas on the Board to pressure its Chair into voting for lower interest rates or resigning.”

WASHINGTON — A federal judge on Friday quashed Justice Department subpoenas issued to the Federal Reserve in January, a severe blow to an investigation that has already attracted strong criticism on Capitol Hill.

Judge James Boasberg said that a “mountain of evidence suggests” that the purpose of the subpoenas was simply to pressure the Fed to cut its key interest rate, as President Trump has repeatedly demanded.

Fed Chair Jerome Powell revealed the investigation Jan. 11, prompting Senator Thom Tillis, a North Carolina Republican to block consideration of Trump’s pick to replace Powell as Fed chair when his term expires May. 15.

Rugaber writes for the Associated Press.