DOJ Drops Criminal Probe Into Fed Chair Jerome Powell Over Renovation Costs

The Justice Department has ended its criminal investigation into Federal Reserve Chairman Jerome Powell over costly renovations at the central bank’s Washington headquarters, shifting the matter instead to an internal watchdog review.

U.S. Attorney Jeanine Pirro announced Friday that the Federal Reserve’s inspector general will now take over scrutiny of the project, which has seen costs balloon into the billions.

“The IG has the authority to hold the Federal Reserve accountable to American taxpayers,” Pirro said, adding that she expects a comprehensive report and will reopen a criminal probe if warranted.

The investigation began in January after subpoenas were issued over Powell’s testimony to Congress regarding the renovation project, which is estimated to cost around $2.5 billion. Those subpoenas were later blocked by a federal judge.

Lawmakers and critics have raised concerns about the scale and features of the overhaul, which reportedly includes rooftop garden terraces, upgraded interiors, and other high-end design elements. The project was originally projected at $1.9 billion in 2019 but has since increased significantly and is scheduled for completion in 2027.

Powell has previously denied claims that the renovations included luxury additions, telling Congress there were no special dining areas, elevators, or other high-end features described in reports.

The decision to drop the criminal probe comes amid broader tensions between the Federal Reserve and President Donald Trump, who has repeatedly criticized Powell over interest rate policy and the cost overruns tied to the project.

The central bank has also reported significant financial losses in recent years, adding to scrutiny over its operations and spending.

With the inspector general now leading the review, federal officials say the focus will shift to determining whether mismanagement occurred and whether further action is necessary.