Federal Prosecutors Launch Criminal Probe into Fed and Jerome Powell
Federal prosecutors have initiated a criminal investigation into the Federal Reserve’s substantial $2.5 billion renovation of its Washington, D.C. headquarters. This inquiry raises critical questions regarding the use of taxpayer dollars and the integrity of the Fed’s operations.
Jerome Powell’s Response to the Investigation
In a video statement, Jerome Powell characterized the investigation as a “pretext” arising from his ongoing conflict with the administration over interest rates. He suggested that it reflects broader “threats and ongoing pressure” from the current government.
Powell emphasized the importance of the Federal Reserve’s independence. “The threat of criminal charges arises from our commitment to set interest rates based on economic evidence rather than political influence,” he stated.
The Context of the Investigation
The Justice Department, represented by spokesperson Chad Gilmartin, has not provided specific comments on the investigation. However, Gilmartin stated that the attorney general is focusing on any misuse of taxpayer funds.
- Investigation launched into the Federal Reserve’s $2.5 billion renovation.
- Concerns over potential mismanagement of taxpayer money.
Political Pressures Surrounding Interest Rates
President Donald Trump has been critical of Powell for not aligning interest rate decisions with his preferences. Trump has pressured the Fed to implement more aggressive rate cuts, particularly over the past year.
In the latter half of the previous year, the Fed did reduce rates three times but has indicated that further cuts are not anticipated soon.
Included Political Dynamics
The pressure from Trump has been characterized by personal criticisms directed at Powell. Additionally, there are efforts to dismiss Fed Governor Lisa Cook, who was appointed by Joe Biden. The Supreme Court is expected to hear arguments regarding Trump’s ability to dismiss Cook later this month.
Details on the Renovation Project
The controversy surrounding the renovation dates back to Powell’s congressional testimony last summer. During the testimony, he explained that the renovation represented cooperation with various agencies, and costs had fluctuated over time.
- Project aims include removing asbestos and updating outdated electrical and ventilation systems.
- Critics claim the renovation project was poorly managed, citing officials from the administration.
This remains a developing story with further updates expected as the situation unfolds.
