The US Attorney’s Office for the District of Columbia has launched a criminal investigation into Federal Reserve Chair Jerome Powell, probing doubts surrounding his congressional testimony on the renovation of the system’s Washington, DC, headquarters.
The inquiry will focus on the accuracy of Powell’s congressional testimony when he was characterizing the size and price of the renovation, officials told the New York Times.
Powell confirmed in a statement that the Department of Justice served grand jury subpoenas to the Federal Reserve, which “threatened a criminal indictment related to [his] testimony.”
The Fed’s two main office buildings, located in DC’s Foggy Bottom neighborhood, started the pricey $2.5 billion renovation in 2022. The project is wholly funded by the system at no additional cost to taxpayers.
The central bank covers all of its own expenses through its own revenue — not congressional appropriations. That revenue is drawn from interest earned on government securities and fees charged to financial institutions.
Powell previously told lawmakers that no one “wants to do a major renovation of a historic building during their term in office.”
“We decided to take it on because, honestly, when I was the administrative governor, before I became chair, I came to understand how badly the Eccles Building really needed a serious renovation,” he said, adding that the building is “not really safe” and not waterproof.
Republicans have accused Powell of lying to a Senate committee about luxury features that would be added during the renovations, including private VIP dining rooms and an outdoor terrace. White House officials claimed the project would rival the Palace of Versailles in inflation-adjusted construction costs.
In his June 2025 testimony to the Senate Banking Committee, the chairman tried to shut down rumors that over-the-top proposals in the 2021 draft were included in the final proposal.
“There’s no new marble. There are no special elevators. They’re old elevators that have been there. There are no new water features. There are no beehives, and there’s no roof garden terraces,” he said.
Planning documents had called for each of those features.
Trump, who is currently heading his own renovation project on the White House’s East Wing, previously threatened legal action over the Fed’s planned renovations.
But Powell claimed that the move wasn’t remotely about the project itself, but President Trump’s decrees.
“The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President,” he said Sunday.
“This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions—or whether instead monetary policy will be directed by political pressure or intimidation.”
Powell said since taking office in 2018, he has always “carried out [his] duties without political fear or favor” and is dedicated to “standing firm in the face of threats.”
“I will continue to do the job the Senate confirmed me to do, with integrity and a commitment to serving the American people,” he wrote.
Trump first nominated Powell to be the Fed’s chair at the start of his first presidential term. At the time of Powell’s confirmation, Republicans had the majority in the House of Representatives and the Senate.
But since then, Powell and Trump have consistently butted heads, most commonly over the Fed’s refusals to bow to the president’s demands to slash interest rates despite inflation falling below 3%. The president had demanded Powell consider resigning over the issue.
Trump told the Times in an interview last week that he already has a pick lined up to replace Powell, whose term expires in May 2026.
The Fed headquarters renovation project is expected to be completed in the fall of 2027.
