US Justice Department ends probe of Federal Reserve

The US Department of Justice said it has ended a criminal investigation into Federal Reserve Chair Jerome Powell. It began the probe over his Congressional testimony on renovations to the Fed’s headquarters. A Republican lawmaker had called for the investigation to be shut down.

The US Attorney for the District of Columbia, Jeanine Pirro, made the announcement on Friday. Her office was looking into cost overruns on the renovation. The Fed’s Inspector General has now been asked to undertake the inquiry.

Powell said in January that the Fed had been served with grand jury subpoenas over his testimony. A court in Washington announced in March that it would quash them. It said “a mountain of evidence” suggests the government served them to pressure Powell into lowering interest rates or resigning. It added that officials have “produced essentially zero evidence to suspect” him of a crime.

Republican lawmaker Thom Tillis is a member of the Senate Banking Committee. He said he would withhold his support for the next Fed chair until the DOJ ends the investigation. The decision to shut down the probe may open a path for Kevin Warsh to lead the central bank.