The Department of Justice has ended its criminal investigation of Federal Reserve Chair Jerome Powell, a move likely to thaw the frozen nomination process of President Donald Trump’s nominee to replace Powell, Kevin Warsh.
US Attorney for DC Jeanine Pirro said today the Fed’s inspector general has been asked to scrutinize the construction project at the center of the probe.
Pirro’s announcement comes after Trump signaled yesterday to Semafor that he was willing to consider an alternative to the Justice Department’s investigation.
Asked at the White House if someone outside the DOJ could get the answers he sought, Trump said: “[They] could. I mean, look, it’s pretty easy.”
Senate Republicans had sent an increasingly clear message to Trump this week that they wanted the investigation dropped. Retiring Sen. Thom Tillis, R-N.C, staking his last year in office on defending Fed independence, had effectively blocked Warsh’s nomination by promising not to vote for him in committee until the probe ended.
“One thing all martyrs have in common: They’re dead,” Tillis said following Warsh’s Tuesday hearing, where Tillis used props to make his case for the Justice Department to drop the inquiry.
Republican senators — and Treasury Secretary Scott Bessent — floated congressional and inspector general investigations as a substitute; Pirro settled on the latter. Powell’s term as chair ends on May 15 and Republican senators want to replace him quickly. Powell can stay on the board as a governor until 2028, though it’s still unclear whether he will do so if Warsh is confirmed.
Kush Desai, a White House spokesman, tweeted support for Pirro’s decision: “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.” He added that the White House expects the Senate to “swiftly confirm” Warsh.
Friday’s news won’t be enough to satiate progressives, who indicated Friday they still had serious concerns.
Sen. Elizabeth Warren, D-Mass., the top Democrat on the Banking Committee, said the Justice Department’s move was merely “an attempt to clear the path for Senate Republicans to install President Trump’s sock pocket Kevin Warsh as Fed Chair.”
“Let’s be clear what the Justice Department announced today: they threatened to restart the bogus criminal investigation into Fed Chair Powell at any time while failing to drop their ridiculous criminal probe against Governor Lisa Cook,” Warren said.