The Justice Department on Friday dropped its criminal investigation into Federal Reserve Chairman Jerome Powell, clearing a key Senate hurdle for Kevin Warsh’s confirmation.
The Justice Department on Friday dropped a criminal investigation into Federal Reserve Chairman Jerome Powell, removing a key obstacle to Senate confirmation of President Donald Trump’s nominee for Fed chairman, Kevin Warsh, a development that could have potential implications for interest rates and the housing market.
U.S. Attorney Jeanine Pirro announced on the
Sen. Thom Tillis (RN.C.) had blocked a Senate vote on Warsh’s confirmation until the investigation was completed. “We remain confident as ever that the Senate will swiftly confirm Kevin Warsh,” the White House said in a statement.
“If the facts warrant it, we will not hesitate to reopen the criminal investigation,” Pirro said.
The Justice Department’s move comes amid a long-running conflict between the Trump administration and the Federal Reserve. Last year, for example, Trump threatened to fire Powell and even referred to the Fed chair as a “major loser.”
Federal Housing Finance Agency Director Bill Pulte has also frequently criticized Powell, accusing the Fed chair of a cover-up.
Criticism frequently centers on the Fed’s $2.5 billion renovation plan for its headquarters in Washington, D.C. The Trump administration believes the project was mismanaged and that Chairman Powell lied to Congress about it. But Trump’s critics say the project is just a pretext and that the president’s criticisms are political in nature. The Fed itself has pushed back against Trump’s accusations.
Meanwhile, the Fed has resisted repeated pressure from President Trump to lower interest rates amid economic uncertainty at home and abroad.
In January, President Trump nominated Kevin Warsh to replace Powell.
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