US justice department will not reopen criminal probe of Fed’s Jay Powell - Financial Times

The U.S. Justice Department announced that it will not reopen the criminal investigation into former Federal Reserve Chair Jay Powell. The decision follows an earlier review by the agency’s inspector general, which concluded that there were no reasonable grounds to refer the matter to the Attorney General for criminal prosecution.

The investigation was launched in January, when prosecutors issued grand‑jury subpoenas seeking records related to a costly renovation project at the Federal Reserve’s headquarters. In March, a federal judge invalidated those subpoenas, ruling that they had been issued for an improper purpose and that the government had presented essentially no evidence of criminal conduct by Powell. The Justice Department chose not to appeal the ruling and subsequently closed the investigation.

The inspector general’s report, released after the judge’s decision, found no basis for a criminal referral but criticized the central bank for significant management and oversight failures that contributed to the project’s soaring costs. The report highlighted deficiencies in the planning and execution of the renovation but stopped short of alleging illegal activity.

President Donald Trump responded to the Justice Department’s announcement on his Truth Social platform, calling for Powell’s resignation from the Board of Governors. Trump argued that Powell was unfit to manage both the building project and the Federal Reserve’s monetary policy, suggesting that his handling of the renovation reflected broader concerns about his leadership.

Federal Reserve officials noted that Kevin Warsh succeeded Powell as chair in May. While the Justice Department indicated it would not revive the criminal probe, officials involved in the case said that an independent audit of the renovation could still trigger further investigation if it uncovers evidence of wrongdoing.