"Jerome Powell Probe: DOJ Won't Reopen Case"

The Justice Department will not reopen its criminal investigation into former Federal Reserve Chair Jerome Powell, closing — for now — the Jerome Powell probe that has shadowed the central bank for months.

Attorney General Todd Blanche told Bloomberg News in an interview on Friday, Oct. 2: "We're not reopening a criminal investigation into him." Blanche was speaking about the investigation into cost overruns on the Federal Reserve's multibillion-dollar headquarters renovation project.

Blanche's comments, first reported by Bloomberg News, effectively close a chapter that began in January and at one point raised the prospect of criminal charges against a sitting central bank chief. The attorney general stopped short of ruling out future scrutiny, however, leaving the door open if the coming audit turns up wrongdoing.

The renovation has ballooned to roughly $2.4 billion, more than $1 billion above its initial estimate, drawing repeated criticism from President Donald Trump. The announcement that the case would stay closed followed the release of a report by the Federal Reserve's inspector general, which found no reasonable grounds to believe a federal crime had occurred that would require a criminal referral to the attorney general.

Jerome Powell Probe Ends After Watchdog Report

The inspector general's report examined the renovation project and concluded there was no evidence of criminal wrongdoing or administrative misconduct, though it identified significant shortcomings in the Fed's oversight. Todd Blanche said he was satisfied with the watchdog's findings.

The DOJ investigation began in January, when prosecutors issued grand jury subpoenas seeking records related to the renovation. A federal judge quashed those subpoenas in March, finding they had been issued for an improper purpose and that the government had produced essentially no evidence Powell committed a crime. The department disputed the ruling but later closed the investigation rather than appeal.

The March ruling quashing the subpoenas was a significant rebuke: the judge found the government had produced essentially no evidence of a crime and concluded the subpoenas were aimed at pressuring Powell over policy disagreements, including his repeated decisions not to lower interest rates.

In January, Powell disclosed the subpoenas in a video address, raising the prospect of criminal charges tied to Senate testimony he gave in June 2025 about the ballooning cost overruns. The judge's March ruling found "abundant evidence that the subpoenas' dominant purpose is to harass and pressure Powell" to yield to the president or resign.

Jerome Powell Probe Could Return With New Evidence

Todd Blanche did not rule out future action. He said the Fed's plan to bring in an independent auditor to scrutinize construction costs could prompt a new investigation if it uncovers evidence of criminal wrongdoing. "If they learn anything that rises to any kind of criminal misconduct, you better believe we're going to investigate that," he told Bloomberg.

President Donald Trump, who has clashed with Powell over the renovation's cost overruns and interest rate policy, slammed the decision in a Truth Social post, saying Powell should be "forced to resign" from the Fed's Board of Governors "at a minimum." "He can't manage a Building, and he certainly shouldn't be allowed to manage his High Interest Rate Policy," Trump wrote.

Powell's term as Fed chair ended in May, but he has remained on the board as a governor. His successor, Fed Chairman Kevin Warsh, said he would hire an independent auditor to "verify accuracy and compliance" for all project costs — the review Blanche said could determine whether the DOJ investigation ever returns. A Fed spokesperson declined to comment on Blanche's statements.

For the central bank, the decision removes a cloud that had hung over its leadership transition. Warsh, who took over as chairman after Powell's term ended in May, now faces the task of completing the renovation under the scrutiny of both an independent auditor and a watchful White House.