US justice department will not reopen criminal probe of Fed’s Jay Powell

The U.S. Justice Department announced it will not reopen a criminal investigation into former Federal Reserve chair Jerome Powell concerning cost overruns tied to the central bank’s building‑renovation project. The decision was confirmed by a department spokesperson on Friday, after Attorney General Todd Blanche told Bloomberg News that while the Justice Department is not reviving the probe, he has not ruled out further scrutiny of the project’s oversight should new evidence of wrongdoing emerge. The Fed’s inspector general had earlier concluded there was no basis for a criminal referral or administrative misconduct, though it noted lax oversight, prompting renewed calls for Powell’s resignation from former President Donald Trump. Powell, who stepped down as chair in May but remains a Fed governor, pledged at his final press conference in April to stay on the board until the investigation is “well and truly over, with transparency and finality.”

The inspector general’s findings highlighted deficiencies in how the renovation’s expenses were monitored, but stopped short of identifying illegal activity. In response, Kevin Warsh, Powell’s successor as Fed chair, announced on Thursday that an independent auditor would be hired to verify the accuracy and compliance of all project costs, aiming to address the oversight gaps identified. Blanche emphasized that any new review uncovering criminal conduct could trigger a Justice Department investigation, underscoring that the matter remains open to further action despite the current decision not to reopen the case.

The development keeps the renovation controversy in the public eye, with implications for both the Federal Reserve’s governance and political scrutiny of its leadership. While the Justice Department’s stance halts immediate criminal proceedings, the planned independent audit may produce findings that influence future oversight policies and could affect Powell’s standing within the Fed and among critics. The Fed has not provided an immediate comment on the Attorney General’s remarks, leaving observers to watch how the forthcoming audit and any potential new evidence might shape the narrative around the renovation’s management and Powell’s legacy.

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