Full Breakdown
DOJ Ends Probe into Fed Chair Jerome Powell, Clearing Path for Warsh
4/25/2026, 1:53:55 AM
Renovation Cost Overruns and Political Stakes
The Department of Justice announced the closure of its criminal investigation into Fed Chair Jerome Powell and the Federal Reserve’s Washington headquarters renovation. The probe focused on cost overruns for two historic Fed buildings, which rose from $1.9 billion in 2023 to $2.5 billion in 2025. The investigation concerned taxpayers bearing billions in excess costs.
Political Stakes: Nomination, Committee, and Key Players
President Donald Trump nominated former Fed governor Kevin Warsh to replace Powell when his term ends on May 15. Senator Thom Tillis, a Republican on the Senate Banking Committee, placed a hold on Warsh’s confirmation, arguing the open DOJ probe blocks the nomination. The committee’s 12-10 Republican edge means Tillis’s vote can create an 11-11 deadlock, freezing the vote.
Official Statements & Responses
U.S. Attorney Jeanine Pirro announced that her office is referring the matter to the Federal Reserve’s Inspector General, who has authority to hold the Fed accountable to taxpayers. Senator Thom Tillis argued that the investigation undermines Fed independence and must be resolved before a confirmation vote. Jerome Powell said the probe is intended to pressure the Fed into faster rate cuts and that he will remain in his role until the investigation is fully concluded. Kevin Warsh has not issued a public comment.
Criticism & Opposition
Critics on the Senate Banking Committee, led by Tillis, argue the DOJ’s involvement threatens the central bank’s autonomy and could be used to influence monetary policy. Tillis’s stance reflects broader Republican concerns about perceived political pressure on the Fed.
Conflicting Reports & Gaps
While the DOJ’s decision removes the immediate criminal probe, it does not resolve whether the Inspector General’s review will satisfy Tillis’s conditions. Powell’s insistence that the investigation be fully concluded before he departs leaves uncertainty about his exit, and Pirro’s statement leaves open the possibility of restarting the investigation.
Verbatim Quotes
- “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,” — Jeanine Pirro, U.S. Attorney, District of Columbia
- “Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so,” — Jeanine Pirro, U.S. Attorney, District of Columbia
- “Powell, for his part, has said the investigation is a pressure tactic designed to force the Fed to cut interest rates faster than it believes is warranted.” — Jerome Powell, Federal Reserve Chair
- “weak” and “frivolous.” — Thom Tillis, U.S. Senator, North Carolina
- “not back off,” — Jeanine Pirro, U.S. Attorney, District of Columbia
What’s Next
The Inspector General’s review will determine whether Senator Tillis lifts his hold, allowing the Senate Banking Committee to advance Warsh’s confirmation. If the review uncovers further irregularities, the DOJ could reopen the probe, potentially delaying both the nomination and any changes to Fed leadership.
