Federal Prosecutors Denied Access to Federal Reserve Amid Ongoing Investigation
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Federal prosecutors were denied entry to the Federal Reserve's headquarters during an unannounced visit related to an investigation into a $2.5 billion renovation project, as President Trump threatens to dismiss Chair Jerome Powell.
Federal prosecutors made an unannounced visit this week to the Federal Reserve's headquarters, seeking access to a construction site involved in a $2.5 billion renovation project under investigation. The prosecutors were denied entry by a contractor and directed to the Federal Reserve's legal team. This visit underscores the Trump administration's continued scrutiny of the Federal Reserve and its Chair, Jerome Powell, despite a federal judge previously describing the investigation as "pretextual" and prosecutors acknowledging a lack of evidence of criminal activity.
President Donald Trump has reiterated his intention to dismiss Powell if he remains on the Federal Reserve's governing board after his term as Chair expires next month. In a recent interview, Trump stated, "Well then I'll have to fire him, OK?" when reminded of Powell's intention to stay on the board during the ongoing investigation. Powell has indicated he will remain as Chair of the Federal Reserve's rate-setting committee until a successor is confirmed by the Senate, following established precedent.
The investigation, led by U.S. Attorney Jeanine Pirro's office, focuses on cost overruns in the Federal Reserve's renovation project, which has escalated from an initial estimate of $1.9 billion in 2022 to the current $2.5 billion. Powell's testimony before the Senate Banking Committee last June regarding these overruns is a central aspect of the probe. Despite the lack of evidence of wrongdoing, the investigation has delayed the confirmation of Kevin Warsh, Trump's nominee to succeed Powell. Senator Thom Tillis, a Republican member of the Senate Banking Committee, has stated he will oppose Warsh's confirmation until the investigation concludes.
The Supreme Court is also considering a related case involving the president's attempt to remove Federal Reserve Governor Lisa Cook over disputed mortgage fraud allegations. Lower courts have allowed Cook to remain in her position while her legal challenge proceeds. The outcome of this case could have implications for the independence of the Federal Reserve and the president's authority over its officials.