The Justice Department has officially closed its criminal investigation into Federal Reserve Chair Jerome Powell, shifting the matter to the Federal Reserve’s Inspector General. The move effectively removes a major hurdle for the confirmation of Kevin Warsh, who is nominated to succeed Powell as head of the central bank.
U.S. Attorney Jeanine Pirro announced the decision Friday morning on X, stating that she has requested the Inspector General (IG) to scrutinize the multi-billion-dollar cost overruns associated with the Federal Reserve’s headquarters renovation project.
Pirro noted that the IG has the authority to hold the Fed accountable for expenses “borne by taxpayers” and said she expects a “comprehensive report in short order.”
“Accordingly, I have directed my office to close our investigation as the IG undertakes this inquiry,” Pirro wrote. However, she added a caveat regarding the future of the case. “Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so.”
READ: National Security Trumps Lawsuit: Why Judges Can’t Touch This Immigration Job Rescission
The closure of the DOJ probe follows a significant setback in court last month. In March, U.S. District Judge James Boasberg blocked the department’s subpoenas for Federal Reserve records, ruling that the government had produced “essentially zero evidence” to suspect Powell of a crime. In his unsealed opinion, Boasberg characterized the investigation as “pretextual” and suggested its primary purpose was to pressure Powell into resigning or changing interest rate policies.
The investigation originally focused on Powell’s testimony to Congress regarding the ballooning costs of the Fed’s $2.5 billion office renovation. Powell has consistently denied any wrongdoing, rebuking the probe in January as a politically motivated effort to influence monetary policy.
The decision to transition the inquiry to the Inspector General was met with approval from critics of the initial investigation. Senator Thom Tillis, a North Carolina Republican on the Senate Banking Committee, had previously urged the U.S. Attorney’s office to “save itself further embarrassment and move on,” calling the probe a “failed attack on Fed independence.”
By closing the criminal investigation, the Justice Department has cleared the landscape for the Senate to proceed with the confirmation of Kevin Warsh. Warsh, a former Fed governor, had seen his nomination clouded by the legal tension surrounding the outgoing chair.
Pirro maintained that the results of the IG review would ultimately provide clarity on the issues that prompted the initial subpoenas.
“I am confident the outcome will assist in resolving, once and for all, the questions that led this office to issue subpoenas,” she stated. For now, the move shifts the scrutiny from a criminal courtroom to an internal regulatory audit.
Please make a small donation to the Tampa Free Press to help sustain independent journalism. Your contribution enables us to continue delivering high-quality, local, and national news coverage.
Sign up: Subscribe to our free newsletter for a curated selection of top stories delivered straight to your inbox
