Fed watchdog clears former chair Powell in renovation probe
Por Courtenay Brown — Axios
A Federal Reserve watchdog found no criminal wrongdoing by former chair Jerome Powell in its investigation of the central bank’s expensive headquarters renovation, according to a report released on Wednesday.
Why it matters: The findings effectively clear Powell after the Justice Department opened an unprecedented criminal investigation into then-Fed chair, which became public in January.
What they’re saying: “At no point during our evaluation did we find reasonable grounds to believe that a violation of federal criminal law had occurred requiring a referral to the U.S. Attorney General,” the Office of Inspector General wrote in the report.
- The watchdog added that it “did not identify administrative misconduct during our evaluation.”
Yes, but: While the report clears Powell, it faults Fed management and oversight of the project as construction costs more than doubled to $2.5 billion.
- The Fed “did not take numerous actions available to it that could have better controlled costs and mitigated some of the significant construction cost increases,” the report says.
Flashback: The renovation became a flashpoint in President Trump’s broader campaign against Powell and the Fed.
- Trump toured the construction site with Powell in July 2025 and publicly challenged him over the project’s soaring costs.
Zoom out: The Justice Department’s investigation centered on Powell’s June 2025 testimony to Congress about the renovation and its rising costs.
- Powell denied wrongdoing and argued at the time that the investigation was part of a broader effort to pressure the Fed over interest rates.
- DOJ closed the investigation in April as the Fed’s inspector general continued its review.
Zoom in: The watchdog said that inflation alone could not explain the project’s higher costs.
- For instance, the report shows that two major mechanical, electrical and plumbing contracts more than tripled to $539 million from an earlier $178 million estimate, far outpacing the broader rise in construction costs.
What to watch: Powell has remained on the Fed’s board after his term as chair ended in May — an unusual move that he said was tied to seeing the investigation through to its conclusion.
Fonte: Axios
