U.S. Department of Justice Halts Investigation into Fed Chair Powell…Next Chair's Confirmation Expected to Accelerate (Comprehensive)

U.S. Department of Justice Halts Investigation into Fed Chair Powell…Next Chair's Confirmation Expected to Accelerate (Comprehensive)

Prosecutorial investigation targeting Powell for 'excessive spending on Fed building renovation' to be concluded.

White House: "Next chair must be swiftly confirmed…Truth to be uncovered under the jurisdiction of another agency."

The U.S. Department of Justice announced on the 24th (local time) that it would conclude its investigation into allegations of excessive spending on the renovation of the Federal Reserve (Fed) building, which had been targeting Fed Chair Jerome Powell.

Accordingly, the Senate confirmation process for the successor, Kevin Warsh, the nominee for the next chair, is expected to accelerate. Earlier, some lawmakers from the ruling Republican Party had publicly stated that they would not cooperate with the successor's confirmation if the investigation into Chair Powell was not halted.

Janine Pirro, the U.S. Attorney for the District of Columbia, who led the investigation into Chair Powell, stated on X (formerly Twitter) that the Fed's Inspector General would investigate the issue of excess spending on the building renovation, adding, "I have directed our investigation to be concluded while this investigation proceeds."

She further stated that if the Inspector General's investigation confirms the allegations of excessive spending, "we will not hesitate to resume a criminal investigation."

The Department of Justice had been investigating Chair Powell since last year in connection with allegations of excessive spending that arose during the renovation of the Fed building.

This has led to interpretations that it was an investigation aimed at pressuring Chair Powell, who did not comply with President Donald Trump's demands for interest rate cuts.

President Trump said in a media interview on the 21st, "We need to find out why a project that should have cost $25 million ended up costing billions."

With the Department of Justice officially halting the investigation into Chair Powell, a green light is expected for the Senate confirmation process for Warsh, who was nominated as the next Fed chair in January.

Some Republican members of the Senate Banking Committee, the relevant standing committee, had criticized the Department of Justice's investigation into Chair Powell and maintained their opposition to Warsh's confirmation until the issue was resolved.

Consequently, Warsh's confirmation hearing took place on the 21st, but the timing of the confirmation vote remained uncertain.

As Chair Powell's term is set to expire on May 15, the White House and Republican leadership are expected to complete the confirmation process and push for Warsh's appointment before then. Meanwhile, Chair Powell's term as a board member, separate from his chairmanship, extends until January 2028.

The New York Times (NYT) reported on the Department of Justice's termination of the investigation, stating, "It reflects the reality that President Trump, who has spent years trying to dismiss Chair Powell and force interest rate cuts, could not put his preferred candidate in that position while this investigation was ongoing."

White House spokesperson Caroline Leavitt told reporters today that U.S. Attorney Pirro's statement does not necessarily mean the investigation is over, emphasizing that the investigation will continue through the Inspector General.

Leavitt said, "It is in the taxpayers' interest to get to the bottom of this," and "The investigation is still ongoing; it's just being conducted under the jurisdiction of another agency."

She added, "We need to proceed with Warsh's confirmation as quickly as possible," and "(some members) should not hold our nation's economy hostage due to disagreements with the Department of Justice."