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\n President Trump and Federal Reserve Chair Jerome Powell tour the Fed’s $2.5 billion headquarters renovation project on July 24, 2025.<\/p>\n
Chip Somodevilla\/Getty Images<\/p>\n
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Chip Somodevilla\/Getty Images<\/p>\n
The U.S. Justice Department is dropping its criminal investigation of Federal Reserve Chair Jerome Powell, paving the way for the Senate to confirm Kevin Warsh, the president’s nominee to head the central bank<\/a>.<\/p>\n The decision marks a reversal for Jeanine Pirro, the U.S. attorney for the District of Columbia, who had vowed to continue the probe into cost overruns during the renovation of two Fed buildings, even after a judge had blocked<\/a> the investigation. <\/p>\n Pirro said she would instead ask the Fed’s inspector general to look into the cost overruns, which have risen from $1.9 billion to $2.5 billion in recent years. The central bank has attributed the higher costs<\/a> to unexpected developments like excess lead, asbestos and inflation, which has raised the cost of building projects nationwide.<\/p>\n “This morning the Inspector General for the Federal Reserve has been asked to scrutinize the building costs overruns,” Pirro said in a post on X<\/a>. “Accordingly, I have directed my office to close our investigation as the IG undertakes this inquiry.”<\/p>\n The Fed’s inspector general has reviewed the construction project twice. It found no wrongdoing. <\/p>\n Fight over central bank independence <\/p>\n Pirro’s probe came after President Trump had repeatedly attacked<\/a> the Fed and Powell for not raising interest rates more aggressively. Trump has blasted the renovations, verbally sparring<\/a> with Powell during a visit to the site. <\/p>\n In March, a federal judge put the brakes<\/a> on the DOJ, saying its criminal investigation was part of an improper campaign by the Trump administration to pressure the central bank into cutting rates. But Pirro had vowed to appeal that decision.<\/p>\n Her probe has drawn widespread criticism. Powell has called it<\/a> a pretext for the White House’s efforts to pressure the Fed into lowering interest rates, and a federal judge has agreed<\/a>, criticized the investigation as an unjustified act of intimidation. <\/p>\n