DOJ Drops Investigation into Federal Reserve and Jerome Powell

The Department of Justice dropped its criminal investigation into the Federal Reserve and its chairman Jerome Powell on Friday. The investigation centered on questions about renovations to the central bank's Washington, D.C., campus.

"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 for the District of Columbia, said in a post on X. "Accordingly, I have directed my office to close our investigation as the IG undertakes this inquiry."

Pirro said she expects a comprehensive report detailing the inspector general's findings.

"Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so," Pirro said.

In two previous investigations, the inspector general for the Federal Reserve looked into the renovation project and found no wrongdoing. Powell also requested an investigation of the project in 2025, following mounting pressure from President Donald Trump and his allies.

The buildings in question have not been renovated since the 1930s, according to the Federal Reserve. The initial estimate for the project was $1.9 billion, but the renovations have far exceeded that, reaching at least $2.5 billion.

The increased budget can be attributed to the rising cost of materials, asbestos damage, cost of labor, and equipment, the central bank said. The building itself is also built on a sinkhole.

During a tour of the construction site last summer, Trump questioned Powell about the cost of the project, saying he heard the cost hit "about $3.1 billion."

Powell pushed back, telling the president, “I haven’t heard that," sparking a viral interaction between the fed chair and the president.

Director of the United States Office of Management and Budget Russel Vought previously said he believes Powell was guilty of "fiscal mismanagement."

Trump has since nominated Kevin Warsh to replace Powell. Powell's term as chair ends May 15.

Dropping the investigation ostensibly clears the way for Warsh's confirmation. Senator Thom Tillis (R., N.C.) said he would not vote to confirm Warsh until the investigation into Powell was resolved. Tillis previously said the probe was "bogus."

The renovation project was originally approved in 2017 by the Fed's seven board members, one year before Powell assumed his role as chair.

Pirro said the inspector general has the power and ability to ensure the Federal Reserve is accountable to taxpayers in her statement announcing the conclusion of the investigation.

The Federal Reserve did not immediately respond to National Review's request for comment.