Story perspectives

Justice Department Investigates Fed Chair Powell Over Renovation Allegations

1/18/2026

Summary

Story summary

Justice Department launched a criminal investigation into Jerome H. Powell, chair of the Federal Reserve, focusing on $2.5 billion renovation and allegations of lying to Congress.
U.S. Attorney Jeanine Pirro, a Trump ally, approved the inquiry.
It marks escalation in U.S. President Donald Trump’s campaign against Powell, who has criticized Trump for not lowering interest rates.
Powell denounced the probe as unprecedented and politically motivated, raising concerns about Fed independence.

History

Historical Context

Established on December 23, 1913, the Federal Reserve System was created to stabilize the U.S. financial system following the Panic of 1907. Over the years, it has faced scrutiny regarding its independence and effectiveness, particularly during economic crises like the Great Depression and the 2008 financial crisis. Current investigations into Chair Jerome Powell reflect ongoing tensions between political leaders and the Fed's autonomy.

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Story summary

Justice Department launched a criminal investigation into Jerome H. Powell, chair of the Federal Reserve, focusing on $2.5 billion renovation and allegations of lying to Congress.
U.S. Attorney Jeanine Pirro, a Trump ally, approved the inquiry.
It marks escalation in U.S. President Donald Trump’s campaign against Powell, who has criticized Trump for not lowering interest rates.
Powell denounced the probe as unprecedented and politically motivated, raising concerns about Fed independence.

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