Pirro, in Abrupt Reversal, Signals End of Powell Investigation

A federal probe into the Federal Reserve is ending, possibly clearing the path for the confirmation of a new Federal Reserve chairman.The United States attorney for the District of Columbia, Jeanine Pirro, announced on Friday that the inspector general for the Federal Reserve has been asked to scrutinize the building costs overruns.“Accordingly, I have directed my office to close our investigation as the IG undertakes this inquiry,” Ms. Pirro said in an X post. “Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so.”President Trump had hinted on Thursday that he could be open to an alternative investigation into the Federal Reserve and chairman Jerome Powell.Asked about it at the White House, Mr. Trump said he could accept a different investigation path. “I mean, look, it’s pretty easy,” Mr. Trump told reporters.The investigation into overruns at a headquarters renovation project has threatened to delay the confirmation of a new Fed chairman. Mr. Powell’s term as Fed chairman ends on May 15. Mr. Trump has nominated Kevin Warsh, a former Fed governor, to replace him but Senator Thom Tillis had vowed to hold up the confirmation of any new board member until the criminal investigation into Mr. Powell finished.Ms. Pirro had opened a criminal probe after Mr. Trump pushed for an investigation into cost overruns on a $2.5 billion renovation of the Fed headquarters.One of the allegations was that Mr. Powell lied to Congress when questioned about the overruns on the project, which was initially estimated at $1.9 billion. Mr. Powell released a video in January to disclose that the Justice Department had served the Federal Reserve with grand jury subpoenas, threatening a criminal indictment related to his testimony before the Senate Banking Committee last June.Mr. Powell called the action “unprecedented” and said it should be viewed “in the broader context of the administration’s threats and ongoing pressure.” Mr. Powell claimed he was facing potential criminal charges only because the board had not heeded the president’s call to rapidly lower interest rates.The chief judge of the United States District Court for D.C., James Boasberg, agreed with Mr. Powell and dismissed the subpoenas, but Ms. Pirro had filed a request that he reconsider.Ms. Pirro’s office had claimed that Judge Boasberg’s initial motion to quash the subpoenas used “an incorrect legal standard” and overlooked facts in the case.Mr. Tillis has stood as a roadblock to Mr. Warsh’s confirmation because he is concerned about the independence of the central bank. He suggested earlier this month that he would support a Congressional investigation to replace the Department of Justice probe but Ms. Pirro pushed back on that idea, saying she would not back down from her investigation.“This investigation continues,” Ms. Pirro told reporters on Wednesday. “I am going forward,” she added.In another sign that the investigation was not winding down, prosecutors from Ms. Pirro’s office sought access to the Fed’s building site last week. They were turned away and told they needed prior authorization to enter.Mr. Powell said he had “no intention” of leaving the Fed as long as the probe continued. His term as chairman is set to expire on May 15 but his term as a Fed governor lasts until January 2028. Outgoing Fed chairmen have traditionally resigned from the board when their terms as chairman have ended.Mr. Trump said last week that he’ll fire Mr. Powell if he doesn’t leave when his term as chairman ends. That could set off a new court battle.The Banking Committee’s chairman, Senator Tim Scott, has not set a date for a vote on Mr. Warsh’s nomination but time is running out to confirm him before May 15.Mr. Tillis’s office did not reply immediately to a request for comment.

Pirro, in Abrupt Reversal, Signals End of Powell Investigation

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