The
United States Justice Department
is ending a
controversial investigation
into building-renovation cost overruns by the
Federal Reserve
, potentially clearing a path to confirmation for
Kevin Warsh
, President
Donald Trump’s
pick to be the next Federal Reserve leader.
U.S. Attorney Jeanine Pirro said in a social media post Friday that the
Federal Reserve
Inspector General had been asked to scrutinize the cost overruns. She said she expects a report soon on the findings.
“I have directed my office to close our investigation as the IG undertakes this inquiry,” Pirro said in the post. “Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so.”
The White House said in a statement that “American taxpayers deserve answers about the Federal Reserve’s fiscal mismanagement, and the Office of the Inspector General’s more powerful authorities best position it to get to the bottom of the matter.”
Pirro initiated a legal battle to serve subpoenas to the central bank as part of a criminal investigation into the cost overruns and congressional testimony chair
Jerome Powell
provided on the matter.
Warsh, who appeared before the Senate Banking Committee this week, enjoys broad support among GOP lawmakers, but a key Republican senator, Thom Tillis of North Carolina, vowed to block his confirmation unless the DOJ investigation was dropped.
Tillis’ office didn’t immediately respond when asked for comment. The Federal Reserve declined to comment.
The reversal was abrupt because Pirro said earlier this week she was committed to continuing the investigation. Pirro’s office didn’t reply to questions about what changed. Justice Department leaders also had given their support to Pirro as a matter of principle to challenge a ruling that undercuts the ability of prosecutors to use grand juries during the early stages of an investigation.
Pirro said the Federal Reserve inspector general “has the authority to hold the Federal Reserve accountable to American taxpayers.”
“I expect a comprehensive report in short order and am confident the outcome will assist in resolving, once and for all, the questions that led this office to issue subpoenas,” Pirro said.
U.S. District Chief Judge James Boasberg in March quashed two grand jury subpoenas that Pirro’s office served in January. Pirro had said she would appeal the ruling.
The investigation threw the Federal Reserve’s expected leadership transition into chaos, as Powell’s term as chair is scheduled to expire on May 15.
With assistance from Christopher Condon, Kate Davidson and Skylar Woodhouse.
Bloomberg.com
DOJ drops Powell probe, smoothing path for Warsh to lead Fed
2026-04-24 16:27:21
