DOJ Drops Probe Into Fed Chair Powell
The Department of Justice has officially ended its criminal investigation into Jerome Powell over the renovation of the Federal Reserve’s Washington headquarters. The decision removes a significant obstacle in the confirmation process of Fed nominee Kevin Warsh.
Move Clears Path for Leadership Transition
The closure of the investigation effectively resolves a dispute that had threatened to delay the appointment of the next Federal Reserve chair. Powell’s term is set to expire next month, and he previously indicated he would remain in his role until a successor is confirmed.
Inspector General to Review Cost Overruns
According to Jeanine Pirro, the Federal Reserve’s Inspector General has been tasked with reviewing cost overruns linked to the headquarters renovation project, which reportedly reached into the billions of dollars.
She stated that the Justice Department would step back while the internal watchdog conducts its inquiry, but left open the possibility of reopening the case if new findings justify further action.
Ongoing Scrutiny of Federal Reserve Project
The renovation project, estimated at around $2.5 billion, had already undergone an audit in 2021. Powell later requested an additional review last year, reflecting continued scrutiny over the project’s costs.
Senate Standoff Now Resolved
The DOJ’s decision is expected to remove a key political barrier in the Senate. Thom Tillis had previously blocked progress on Warsh’s confirmation, insisting that the investigation into Powell be resolved before any vote could proceed.
His position created a significant challenge for Senate leadership, particularly given his influence on the closely divided Senate Banking Committee.
Focus Shifts to Warsh Confirmation
With the investigation now closed, attention turns to the Senate confirmation process for Kevin Warsh. The development is likely to accelerate proceedings and bring clarity to the Federal Reserve’s upcoming leadership transition.
