DOJ Drops Probe Into Fed Chair Powell, Clearing Path for Leadership Transition

The U.S. Department of Justice has ended its criminal investigation into Federal Reserve Chair Jerome Powell, removing a potential obstacle to the upcoming leadership transition at the central bank and easing uncertainty around the confirmation of his successor.

In a statement posted on X, Washington, D.C. U.S. Attorney General Jeanine Pirro said the inquiry would be closed as oversight shifts internally.

“Accordingly, I have directed my office to close our investigation as the IG undertakes this inquiry. Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so,” Pirro said.

The probe had focused on alleged cost overruns tied to the Federal Reserve’s Washington headquarters construction project. According to reports, senior DOJ officials had briefed lawmakers, including Senator Thom Tillis of the Senate Banking Committee, on plans to drop the case and refer the matter to the central bank’s inspector general.

The timing is notable, as Powell’s term is set to expire next month. He has indicated he will remain in his role until a successor, expected to be Kevin Warsh, is confirmed. The DOJ’s decision is widely viewed as reducing potential friction in that process.