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Why did DOJ open criminal investigation into Jerome Powell? Read Fed chair's full statement
Jerome Powell called the DOJ probe “pretext” resulting from his ongoing struggle with the administration over interest rates.
Federal prosecutors have opened a criminal investigation into the Federal Reserve’s $2.5 billion renovation of its Washington, DC, headquarters. In a statement shared by the Federal Reserve Board, Federal Reserve Chair Jerome Powell called the probe “pretext” resulting from his ongoing struggle with the administration over interest rates. He added that it was a consequence of broader “threats and ongoing pressure” by the administration.
Donald Trump and his allies have repeatedly slammed Powell in the past over interest rates. In the second half of last year, the Fed lowered rates three times in a row, according to CNN. However, officials recently said that they are unlikely to lower rates again for a while.
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The controversy started after Powell testified before Congress that the renovation was a collaboration with several agencies. He stated that costs had changed over time.
Trump allies, including Federal Housing Finance Agency Director Bill Pulte and Office of Management and Budget Director Russ Vought, believe the project was mismanaged. However, the Fed believes that the upgrades to the old building were needed, including removing asbestos and upgrading electrical and ventilation systems.
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Jerome Powell releases statement on the investigation
Read Jerome Powell’s full January 11, 2026, statement here:
Good evening.
On Friday, the Department of Justice served the Federal Reserve with grand jury subpoenas, threatening a criminal indictment related to my testimony before the Senate Banking Committee last June. That testimony concerned in part a multi-year project to renovate historic Federal Reserve office buildings.
I have deep respect for the rule of law and for accountability in our democracy. No one—certainly not the chair of the Federal Reserve—is above the law. But this unprecedented action should be seen in the broader context of the administration's threats and ongoing pressure.
This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings. It is not about Congress's oversight role; the Fed through testimony and other public disclosures made every effort to keep Congress informed about the renovation project. Those are pretexts. The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President.
This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions—or whether instead monetary policy will be directed by political pressure or intimidation.
I have served at the Federal Reserve under four administrations, Republicans and Democrats alike. In every case, I have carried out my duties without political fear or favor, focused solely on our mandate of price stability and maximum employment. Public service sometimes requires standing firm in the face of threats. I will continue to do the job the Senate confirmed me to do, with integrity and a commitment to serving the American people.
Thank you.
