The renovations to the U.S. Federal Reserve’s headquarters in Washington, D.C., raised concerns that led federal prosecutors to conduct a comprehensive investigation, consequently drawing Fed Chair Jerome Powell into a legal battle, according to insiders who wished to maintain their identities hidden, as the discussion was viewed as confidential.
These sources alleged that the U.S. attorney’s office in Washington, D.C., directed this investigation, mandating an assessment into whether Powell deceived Congress regarding the renovation details. According to the sources, this investigation was approved in November by Jeanine Pirro, United States Attorney for the District of Columbia.
Powell faces a legal battle
As individuals raised concerns about whether a grand jury had been established or if the Fed team had received any subpoenas, reports highlighted that federal prosecutors had reached out to the team and asked them to issue documents, sparking further discussions.
Reporters sought out the White House to respond to this controversy, but the officials declined to respond. On the other hand, sources familiar with the situation revealed that Powell received several complaints of dissatisfaction from US President Donald Trump, who also demanded that the Fed chair submit his resignation from his role, further intensifying the situation.
In this finding, the reporters discovered that these complaints began to heighten in July 2025. At this particular moment, Russell Vought, the Director of the United States Office of Management and Budget, issued a letter to the Fed chair.
In the letter, Vought stated that Trump raised significant concerns about his management of the Federal Reserve System and the renovation of the Federal Reserve’s headquarters in Washington, D.C., alleging that this project is very costly.
Following the president’s claim, this year’s budget documents indicate that the approximate cost for successfully renovating two historic buildings, particularly in Washington, has increased from the initial $1.9 billion in 2023 to $2.5 billion.
Concerning this increase, the Fed’s 2025 budget stressed that, “construction cost estimates have kept going up, especially for mechanical, electrical, and plumbing work, due to competitive bidding prices.”
Meanwhile, Trump declared that he has appointed an ideal candidate who will assume Powell’s role as the Fed chair when he completes his term in May 2026. Nonetheless, the president chose not to disclose his choice. Even so, odds displayed on Polymarket highlighted that Kevin Hassett, the director of the National Economic Council, has secured the position as the top candidate.
Powell claims to be innocent
As debates continued to escalate regarding the progress of Powell’s criminal investigation, the Fed chair released a statement dated Sunday, January 11, stating that the US central bank received grand jury subpoenas from the Department of Justice. Following this issuance, Powell declared the possibility of a criminal indictment.
His statement raised mixed reactions from individuals, with many criticizing Powell. Responding to this, the Fed chair decided to explain the situation in a clear and concise written and video message to facilitate better understanding. He stated that the matter is linked to his testimony, which he submitted before Congress in June, about updates to the central bank’s headquarters.
“No one — certainly not the chair of the Federal Reserve — is above the law, but this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure,” Powell said, arguing the investigation is being used as a pretext to influence monetary policy.
Powell stressed that this move should be viewed within the broader context of the ongoing threats and pressure coming from Trump’s administration.
“The risk of criminal charges comes from the Federal Reserve making decisions about interest rates based on what we believe is best for the public, rather than catering to the president’s wishes,” Powell stated, adding that, “This issue is about whether the Fed can keep setting interest rates based on facts and economic situations, or if monetary policy will instead be influenced by political pressure or intimidation.”
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Source: https://www.cryptopolitan.com/federal-prosecutors-open-probe-into-powell/
