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DOJ drops Powell probe, clearing path for Fed leadership shake-up
By Aurax Desk | April 24, 2026 | 2 min read
The U.S. Justice Department has ended its investigation into Federal Reserve Chair Jerome Powell, removing a major political obstacle ahead of a looming leadership transition at the central bank.
Jerome Powell speaks during a press briefing, after the U.S. Justice Department dropped its investigation into him over Federal Reserve renovation costs.
The U.S. Department of Justice has officially dropped its criminal investigation into Federal Reserve Chair Jerome Powell, bringing an abrupt end to a months-long probe that had cast uncertainty over the future leadership of the central bank.
The investigation, led by U.S. Attorney Jeanine Pirro, focused on alleged cost overruns tied to a multi-billion-dollar renovation of Federal Reserve buildings in Washington. Officials confirmed the case has now been closed, with the matter handed over to the Fed’s internal watchdog, the Office of Inspector General, for further review.
Powell has consistently denied any wrongdoing, and no charges were filed during the course of the inquiry. The probe, which began earlier this year, also examined whether his congressional testimony about the project was misleading.
The decision is widely seen as clearing the path for Kevin Warsh, former Fed governor and President Donald Trump’s nominee, to take over as chair when Powell’s term expires in May. Warsh’s confirmation had been stalled amid political pressure to resolve the investigation first.
While the criminal probe has ended, authorities indicated the issue is not entirely closed. Pirro noted that the investigation could be reopened if new findings emerge from the inspector general’s review, particularly regarding billions in renovation costs that drew scrutiny from lawmakers and the public.
The episode has intensified debate over the independence of the Federal Reserve, with critics arguing the probe risked politicising monetary policy at a sensitive time for the U.S. economy. With the legal cloud now lifted, attention is expected to shift quickly to the Fed’s next leadership decision and its implications for interest rates and economic policy.
Sources: Business Insider, MatketWatch, Justice Department
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