A look at the allegations, the renovations, and the implications.
The Federal Reserve was thrust into the spotlight on Jan. 11, after chair Jerome Powell said the Department of Justice threatened a criminal indictment against the central bank over the institution’s over-budget renovations of its headquarters and his congressional testimony last summer.
Powell alleged that it was an administration-wide pressure campaign to force Fed officials to lower interest rates. Meanwhile, President Donald Trump denied any knowledge of the probe by federal prosecutors.
Here is what to know about the criminal probe.
What Happened
In a Jan. 11 video statement posted on X, Powell confirmed that, two days prior, the U.S. central bank had been served with grand jury subpoenas by the Department of Justice.
U.S. officials threatened a criminal indictment over Powell’s Senate Banking Committee testimony last summer, over perjury allegations related to renovations of the institution’s headquarters in Washington.
The central bank chief alleged that the probe is not really about the renovations or his testimony.
“Those are pretexts,” Powell said. “The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president.”
Trump denied any knowledge of the Justice Department’s probe into the institution, turning the subject to the chair’s job performance.
“I don’t know anything about it, but he’s certainly not very good at the Fed, and he’s not very good at building buildings,” the president told NBC News on Jan. 11.
Last month, Trump teased legal action against Powell surrounding the years-long overhaul of the Fed’s office buildings, saying that the project is “way over budget.”
“We’re thinking about bringing a suit against Powell for incompetence. Because think of it, these aren’t outstanding buildings—these are small buildings,” Trump said during a news conference at Mar-a-Lago in Palm Beach, Florida.
National Economic Council Director Kevin Hassett, speaking to reporters on Jan. 12, called it one of the most expensive buildings in the history of Washington.
“I guess the question is, if you think the building costs $20 billion or $10 billion, do you think at some point that it’s appropriate for the federal government to investigate?” Hassett said.
“If I were Fed Chair, I would want them to do that. I think that it’s really important to understand where the taxpayer money goes and understand why it goes this way or that.”
By Andrew Moran
