Catenaa, Friday, April 24, 2026 – The Department of Justice is dropping its criminal probe of Federal Reserve Chair Jerome Powell, clearing a key obstacle to Kevin Warsh’s confirmation.
US Attorney for Washington, D.C., Jeanine Pirro announced Friday that her office is closing its investigation, launched in January, into whether Powell lied to Congress in testimony last summer about cost overruns on renovations to the Fed’s headquarters. She wrote on X that she is handing over the matter to the Fed’s internal watchdog.
“This morning, the Inspector General for the Federal Reserve has been asked to scrutinize the building cost overruns, in the billions of dollars, that taxpayers have borne.
The IG has the authority to hold the Federal Reserve accountable to American taxpayers. I expect a comprehensive report in short order and am confident the outcome will assist in resolving, once and for all, the questions that led this office to issue subpoenas.
Accordingly, I have directed my office to close our investigation as the IG undertakes this inquiry. Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so.”
As long as this investigation remained open, Warsh had no clear path to confirmation. Republican Sen. Thom Tillis, who sits on the Senate banking committee, vowed to block the confirmation until the probe was dropped.
This week, during Warsh’s hearing before the committee, he called it “bogus” even as he praised Warsh’s qualifications for the post.
Powell, too, had said he would stay on as chair pro tem past the end of his term on May 15 until the investigation was resolved.
Trump has attacked Powell publicly and repeatedly since the start of his second term, demanding lower interest rates. The Fed held rates steady for most of last year, eyeing the impact of Trump’s tariff regime on prices and the economy.
It delivered three rate cuts at the end of 2025, but that was not enough to assuage Trump, who continued demanding lower rates and threatening to fire Powell.
Separately, Trump fired Fed governor Lisa Cook over allegations of mortgage fraud, a case that remains pending at the US Supreme Court. Taken together, Trump’s aggression toward the Fed and its officers brought the issue of central bank independence to the fore.
Under questioning this week from Democrat Elizabeth Warren, Warsh declined to say whether Trump lost the 2020 election, a litmus test question meant to illuminate his independence from the president.
“I believe that this body certified that election many years ago,” Warsh said, but would not give a yes or no response.
Warren on Friday slammed Pirro’s actions, saying it’s “just an attempt to clear the path for Senate Republicans to install President Trump’s sock puppet Kevin Warsh as Fed Chair” and that the Senate should not move forward with his nomination.
Warren noted that the Justice Department threatened to restart what she called the “bogus criminal investigation” into Powell, while not dropping their criminal probe into Cook.
