In what is being seen as the latest ripple in an ongoing but stepped-up battle between President Trump and Jerome Powell, a criminal investigation has been launched centering on the renovation of the Federal Reserve Chairman’s offices in Washington.
According to published reports, the investigation by the U.S. Attorney’s Office for the District of Columbia is exploring whether Powell was truthful when he appeared before a Congressional hearing to discuss the project.
The New York Times, among other publications, is saying that the investigation is more narrowly interested in the scope and cost of the renovation.
The renovation has been ongoing for more than three years and is expected to be completed by the fall of 2027. Originally the project, updating two 1930s structures, was slated to cost $1.9 billion, but soon ballooned to $2.5 billion, partly due to the discovery of asbestos and lead paint in the structures.
According to plans reviewed by the National Capital Planning Commission in 2021, the updating was needed to “address a critical backlog of upgrades, to respond to changes in building codes and regulatory requirements, and to meet requirements for information technology, building security, environmental sustainability, and energy efficiency.”
The renovation work has been also tasked with addressing water damage that has impacted some of the ornate wood carvings in one of the structures.
Besides the extra work required due to the asbestos and lead paint, “construction-sector inflation has made the overruns steeper,” notes the publication Business Insider.
Trump has repeatedly criticized the project as being too expensive, while at the same time attacking Powell himself, commenting last year, “He’s a terrible Fed chair.”
The President has especially taken Powell to task for failing to more substantively reduce interest rates in the last year. Those rates have been cut from around 4.5% in late 2024 to 3.5% last December.
In a statement, Powell said the threat of criminal charges are a “consequence of the Federal Reserve setting interest rates based on our best assessment or what will serve the public, rather than following the preferences of the President.”
The Powell investigation has sparked a largely negative response in Washington.
North Carolina Republican Senator Thom Tillis, in a statement, remarked: “If there were any remaining doubt whether advisers within the Trump Administration are actively pushing to end the independence of the Federal Reserve, there should be none now.”
January 13, 2026
By Garry Boulard
