The United States Department of Justice has closed its investigation into Federal Reserve Chairman Jerome Powell, ending a probe that had centered on allegations of improper cost overruns during the renovation of the Fed's headquarters building, according to reporting by the BBC.
The investigation had drawn significant attention given that President Donald Trump was among those who had publicly accused Powell of mismanagement related to the construction project. Trump and Powell have had a long and publicly contentious relationship, with the president repeatedly criticizing the Fed chairman over interest rate decisions and other matters.
The closure of the probe means Powell faces no legal jeopardy from the matter. No charges were filed as a result of the investigation.
Background on the dispute
The Federal Reserve's building renovation project became a flashpoint between Trump and Powell, with the president pointing to what he characterized as excessive spending on the project. The Fed, which operates as an independent central bank, had undertaken significant renovation work on its Washington, D.C. headquarters.
Powell has remained in his position throughout the political pressure, and the Fed has continued to operate its monetary policy functions independently of the executive branch. The central bank's independence from political influence is considered a foundational principle of its institutional structure.
Broader context
The dropped investigation comes amid an ongoing broader tension between the Trump administration and the Federal Reserve over monetary policy. Trump has publicly and repeatedly called on Powell to lower interest rates, while Powell and the Fed have maintained that their decisions are driven by economic data rather than political considerations.
Powell's term as Fed chairman runs through May 2026. Trump has previously suggested he would like to remove Powell from his post, though legal experts have debated the extent of presidential authority to dismiss a sitting Fed chair before the end of their term.
The Justice Department has not issued a detailed public statement explaining its reasoning for closing the investigation, which is consistent with standard practice when probes conclude without charges being brought.
