US Attorney says Fed IG’s findings will dictate future of her Powell probe

WASHINGTON: The prosecutor who dropped the criminal investigation launched by President Donald Trump’s administration into Federal Reserve Chair Jerome Powell said on Sunday if a Fed internal watchdog probe into cost overruns in the central bank’s headquarters renovations finds no wrongdoing that would end the matter.

Jeanine Pirro, the Trump-appointed US Attorney in Washington, launched the criminal investigation into Powell in January and dropped it last month after US District Judge James Boasberg blocked the Justice Department’s subpoenas issued in the inquiry.

Pirro, speaking on CNN’s “State of the Union” program on Sunday, said of the Fed Office of Inspector General’s examination of the renovations in Washington: “If there’s something there, great - and if there isn’t, I’ll go home.”

Powell, a frequent target of Trump’s ire, had denounced the criminal investigation as a threat to the Fed’s independence. Boasberg concluded that prosecutors had improperly issued the subpoenas, saying a “mountain of evidence” suggested that the investigation - as Powell has argued - was intended to pressure him to rapidly lower interest rates or resign as chair.

When she dropped the criminal probe, Pirro said she instead asked the Inspector General to examine the cost overruns. The Inspector General had already been examining the project after Powell requested a review last year.

“The only way to find out what happened is through the Inspector General,” Pirro said.

That said, Pirro also said that “we continue to litigate the issue, and we will litigate the issue” and “we’re going to make a motion to vacate the order” by Boasberg in order to defend what she sees as a precedent about investigations.

Since his return to the presidency in January 2025, Trump has routinely pushed the central bank to lower interest rates more quickly and more deeply than it has done, despite persistent inflation.

The criminal investigation had put in jeopardy Senate confirmation of Kevin Warsh, Trump’s nominee to replace Powell when his leadership term ends on May 15. Republican Senator Thom Tillis, a critic of the probe, had held up Warsh’s confirmation until the investigation was ended. Pirro’s termination of the probe and deferral to the Inspector General has now allowed Warsh’s nomination to move forward, with confirmation by the Republican-controlled Senate appearing almost certain.

Also speaking on CNN’s “State of the Union,” Tillis welcomed Pirro’s comments and said her decision to hold off on further action while the internal watchdog does its work is “the way this process is supposed to work.”

If the Inspector General finds evidence of criminal wrongdoing, Tillis said, “then we’ll talk about it. But I think this is a nice way of just ramping it down.”

Tillis also said that “at the end of the day, there was no crime committed - and prosecutors that I’ve spoken with all agree.” At last Wednesday’s Federal Open Market Committee meeting, Powell said he would stay on as a Fed governor after the end of his chair term.

“I’m encouraged by recent developments, and I’m watching the remaining steps in this process carefully,” Powell said.