The Department of Justice dropped on Friday its criminal investigation of Federal Reserve Chair Jerome Powell, federal prosecutor Jeanine Pirro announced.
Pirro said in a social media publication that the Inspector General for the Federal Reserve was asked to "scrutinize the building costs overruns" of the Fed's headquarters, which were at the center of allegations against Powell.
"I expect a comprehensive report in short order and am confident the outcome will assist in resolving, once and for all, the questions that led this office to issue subpoenas. Accordingly, I have directed my office to close our investigation as the IG undertakes this inquiry. Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so," Pirro added.
This morning the Inspector General for the Federal Reserve has been asked to scrutinize the building costs overruns – in the billions of dollars – that have been borne by taxpayers.
— US Attorney Pirro (@USAttyPirro) April 24, 2026
The IG has the authority to hold the Federal Reserve accountable to American taxpayers. I…
The development stands in contrast with her vow on Wednesday to continue the probe, which was hampered by a ruling quashing subpoenas her office had issued to the central bank.
The dropping of the case could pave the way for the confirmation of Kevin Warsh, who President Donald Trump has nominated to be the next Fed chair. CNBC noted that Republican Sen. Thom Tillis had put on hold Warsh's confirmation vote until the investigation was dropped.
Warsh faced a contentious confirmation hearing this week, where he claimed that the central bank will remain "strictly independent" and rejected he will be the president's "sock puppet."
"I am committed to ensuring that the conduct of monetary policy remains strictly independent," he told the Senate Banking Committee.
Warsh was grilled by senators about his independence should he be confirmed, particularly considering Trump's demands that interest rates are cut soon to boost economic activity, as well as the stock market.
He claimed that Trump "never once asked me to commit to any particular interest rate decision, period, and nor would I ever agree to do so if he had."
The president, however, was asked earlier on Tuesday if he would be disappointed if Warsh did not push for lower rates as soon as he joined the Fed. "I would," Trump said.
Warsh was asked about the comment during the hearing but again committed to maintaining the central bank's independence.
Some Democrats, however, are openly skeptical. Senator Elizabeth Warren accused him of "sucking up" to the president to "snag his dream job."
Warsh also refused to answer questions from warren about $100 million in assets that he has not disclosed publicly. NBC News noted that he also rejected answering whether the money had ties to the Trump family, foreign governments or Jeffrey Epstein.
Warsh said he has an agreement with the government's ethics office to divest his assets if he's confirmed and is in compliance with ethics rules.
Originally published on IBTimes
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