DOJ Closes Criminal Probe Into Fed Chair Powell, Clearing Path for Successor
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The Department of Justice has dropped its criminal investigation into Federal Reserve Chair Jerome Powell, removing a key obstacle to confirming his successor. Powell's term expires in three weeks, and he has stated he will remain on the Fed board as a governor through 2028. The White House and Senate Republicans can now proceed with the nomination of Kevin Warsh.
Facts First
- The Department of Justice (DOJ) has closed its criminal probe into Federal Reserve Chair Jerome Powell.
- Senator Thom Tillis had blocked the confirmation of nominee Kevin Warsh pending the investigation's conclusion.
- Powell's term as chair expires in three weeks, but he can remain on the Fed board as a governor through 2028.
- A federal judge twice quashed DOJ subpoenas issued to Powell related to the investigation.
- The Inspector General (IG) for the Federal Reserve will now scrutinize building cost overruns borne by taxpayers.
What Happened
The Department of Justice (DOJ) announced it is dropping its criminal investigation into Federal Reserve Chair Jerome Powell. The probe examined whether Powell had committed fraud and lied to Congress regarding the central bank's multibillion-dollar building renovations. U.S. attorney for the District of Columbia, Jeanine Pirro, stated she directed her office to close the investigation as the Inspector General (IG) for the Federal Reserve undertakes an inquiry into the building cost overruns. A federal judge had twice quashed DOJ subpoenas issued to Powell, who disclosed receiving them in January.
Why this Matters to You
The resolution of this investigation may lead to a smoother transition in leadership at the Federal Reserve, which sets the interest rates that affect your mortgage, car loan, and savings account yields. With the path cleared for a successor, the confirmation process for the next Fed chair could proceed without the delay that was being caused by the pending investigation. The ongoing IG inquiry into building costs aims to ensure taxpayer funds are properly managed.
What's Next
The White House and Senate can now move forward with the confirmation of Kevin Warsh as the next Federal Reserve chair. Jerome Powell is scheduled to hold what appears to be his final press conference as chair next week, and his term expires at the end of next month. Powell has stated he intends to remain on the Federal Reserve Board as a governor through 2028. The Inspector General's inquiry into the building renovations will proceed.