The Justice Department will close its criminal investigation into Federal Reserve Chair Jerome Powell, likely clearing the way for Kevin Warsh’s confirmation to lead the central bank.
U.S. Attorney for the District of Columbia Jeanine Pirro announced Friday that she instructed her office to drop the criminal investigation into Powell over his handling of the extensive upgrades to the historic Federal Reserve buildings. Instead, the Federal Reserve’s inspector general will investigate the multibillion-dollar renovation, she said, and issue a report.
Pirro kept open the possibility of a DOJ probe, however.
“I will not hesitate to restart a criminal investigation should the facts warrant doing so,” Pirro wrote in a post on X.
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Pirro added that she expects a “comprehensive report” from the inspector general soon.
The Trump administration was under pressure to close the criminal probe into Powell. Sen. Thom Tillis vowed to block Warsh’s confirmation unless the administration ended the investigation.
“Let’s get rid of this investigation so I can support your confirmation,” Tillis said at Warsh’s confirmation hearing this week.
Powell first said he was under investigation in January, saying it amounted to a political campaign from the Trump administration to get him to slash interest rates.
At his confirmation hearing on Tuesday, Warsh said he would not be Trump’s “sock puppet” and testified that the president never asked him to cut rates in their private meetings.
Sen. Elizabeth Warren, who had a tense exchange with Warsh during his confirmation hearing, said Republican senators worried about the Fed’s independence should not have their concerns assuaged by this development.
“Let’s be clear what the Justice Department announced today: They threatened to restart the bogus criminal investigation into Fed Chair Powell at any time while failing to drop their ridiculous criminal probe against Governor Lisa Cook,” Warren said in a statement Friday. “Anyone who believes Donald Trump’s corrupt scheme to take over the Fed is over is fooling themselves. The Senate should not proceed with the nomination of Kevin Warsh.”
Trump has been vocal for months about his desire to see the Fed cut interest rates dramatically, which the president sees as part of his affordability agenda to lower mortgage rates and stimulate the economy. The Fed board has kept interest rates steady this year due to high inflation, spurred in part by Trump’s war in Iran.
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