Criminal probe into Federal Reserve chairman Jerome Powell is ending, U.S. Justice Dept. says

The Justice Department is ‌closing its investigation ​into cost overruns ​in renovations at the ​Federal Reserve ⁠under ⁠chairman ‌Jerome Powell, U.S. Attorney Jeanine Pirro ⁠said on Friday.

Pirro said ‌the Inspector General of the ​Federal ⁠Reserve has now been asked ⁠to ⁠scrutinize ⁠the ​building costs.

“The IG has the authority to hold the Federal Reserve accountable to American taxpayers,” Pirro said in a social media post. “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.”

However, Pirro said she “will not hesitate to restart a criminal investigation should the facts warrant doing so.”

A federal judge last month blocked subpoenas to the Fed’s board of governors, finding they were issued for the improper purpose of pressuring Powell to cave to U.S. President Donald Trump’s demands to rapidly lower interest rates or resign. As recently as this week, Pirro had vowed to appeal the ruling and continue the investigation.

Powell’s term as chair is set to expire May 15.

The Pirro investigation had stiffened Powell’s attitude toward remaining in a Fed governor’s seat that extends to 2028, the last full year of Trump’s presidency. Fed chiefs traditionally depart the board as well when their leadership terms end.

Trump administration threats against Powell, including the criminal investigation, were threatening to delay the Senate confirmation of Kevin Warsh, Trump’s nominee to succeed Powell.

North Carolina Sen. Thom Tillis, a Republican member of the Senate’s banking committee, has said he regarded the probe as a frivolous assault on the Fed’s independence and would block Warsh’s confirmation until it is dismissed.

Democrat Warren unimpressed by announcement

Democrats and former Federal Reserve leaders also slammed the probe into costs as a pretext for undermining the independence of the panel from the White House. Trump has frequently cited incorrect numbers for the cost of the renovations, earning a correction from Powell last year when the pair were standing side by side.

Three of the Fed’s seven current governors were appointed by then-president Joe Biden, including Lisa Cook. The Trump administration has sought to fire Cook, a case that is pending in the U.S. Supreme Court.

WATCH | Few outside administration supported the probe:

Investigation into U.S. Federal Reserve chair sparks widespread criticism

The launch of a criminal investigation into U.S. Federal Reserve chair Jerome Powell has politicians on all sides questioning what it could mean for the independence of the institution in charge of the country’s monetary policy.

Sen. Elizabeth Warren, a member of the banking committee, said in social media post that Friday’s announcement was a transparent bid to help clear the nomination for “Trump’s sock puppet Kevin Warsh,” pointing to the failure to drop the Cook pursuit, as well as Pirro’s pledge to restart a Powell criminal probe if necessary.

“Anyone who believes Donald Trump’s corrupt scheme to take over the Fed is over is fooling themselves,” said Warren, a Democrat from Massachusetts.

Warsh, a former Fed governor between 2006 and 2011, said “monetary policy independence is essential,” in comments Tuesday to U.S. senators.

Warsh, 57, also said he had made no promises to Trump about cutting interest rates. Just before that Senate hearing, Trump had told CNBC he would be disappointed if a rate cut didn’t immediately occur under Warsh’s stewardship.

During his testimony on Tuesday, Warsh blamed the central bank under Powell for an inflation surge in the wake of the COVID-19 pandemic that he said continues to hurt U.S. households.