President Donald Trump has threatened to sue Federal Reserve Chairman Jerome Powell over the costly bank restructuring project.
The US attorney’s office in the District of Columbia has opened a criminal investigation into Federal Reserve Chairman Jerome Powell, focusing on the renovation of the central bank’s headquarters in Washington and whether he was truthful in his congressional testimony about the project.
Officials told The New York Times, which first reported the investigation, that it focused on whether Powell accurately disclosed the scope and cost of the renovations during the conference call.
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Jerome Powell, chairman of the US Federal Reserve, during the open meeting of the Federal Reserve Board in Washington, DC, US, on Wednesday, June 25, 2025. (Al Drago/Bloomberg via Getty Images/Getty Images)
Powell confirmed that the Federal Reserve has been provided. He said he respected the law and congressional oversight but described the Justice Department’s move as “unprecedented” and politically motivated.
“This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings,” Powell said in a video statement Sunday evening.
“The threat of criminal charges is the result of the Federal Reserve setting interest rates based on our best assessment of what is in the best interest of the public, rather than following the President’s preferences,” he added.
The White House did not immediately respond to Fox News Digital’s request for comment.
US President Donald Trump and Federal Reserve Chairman Jerome Powell speak during a tour of the Federal Reserve Board building, which is currently under renovation, in Washington, DC, on July 24, 2025. (REUTERS/Kent Nishimura/Reuters)
The tension between the President Donald Trump and Powell are puzzled by the central bank’s interest rate decisions and widely monetary policies. Trump ordered the Fed to cut rates, which he said could save the nation “hundreds of billions of dollars.”
Powell kept the target rate at 4.25% to 4.5% as the Fed takes a wait-and-see approach to assess the impact of Trump’s sweeping tax cuts. While the central bank has since cut rates, Trump’s attacks on Powell, who he nominated in 2017, have become increasingly personal, including the use of humorous nicknames.
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That strained relationship has extended beyond monetary policy.
Adjustment of The Federal Reserve two large offices in Washington’s Foggy Bottom area are estimated to cost $2.5 billion and are funded by the central bank itself, not taxpayers.
The Fed is self-financing and does not rely on congressional appropriations to cover its operating expenses, which include employee salaries, facilities maintenance and current repairs. Primary income comes from interest earned on government securities and fees charged by financial institutions.
The main atrium of the Marriner S. Eccles Federal Reserve building during a media tour of the central bank’s headquarters renovation in Washington, DC, on July 24, 2025. (Photos by Andrew Harnik/Getty/Getty)
In June 2025, Powell told members of the Senate Banking Committee that “There is no new marble. No special elevators. Old elevators have been. No new water features. No beehives, and no rooftop gardens.”
Powell also told lawmakers that no one “wants to do a major renovation of a historic building during the administration.”
“We decided to take it because, frankly, when I was the governor of the administration, before I became the chairman, I understood how much the Eccles Building really needed serious repairs,” Powell said, adding that the building is “not really safe” and is not waterproof.
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The two-story main board room of the Marriner S. Eccles Federal Reserve building during a press tour of the central bank’s headquarters renovation in Washington, DC, on July 24, 2025. (Photos by Andrew Harnik/Getty/Getty)
He also said the cost overruns were due, in part, to unexpected construction challenges and the country’s inflation rate.
The project is expected to be completed in the fall of 2027, and Washington workers are expected to begin work on the building in March 2028.
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Trump has previously threatened legal action over the plan’s overhaul and mocked its cost and design.
“They’re building an underground facility on the Potomac River. I would have told them it’s very difficult to do, and it’s ineffective, and it’s very expensive,” Trump said. “But it’s up to $4 billion, led by this actor,” he added in November, referring to Powell.
The project is scheduled to be completed in the fall of 2027, and Washington-based workers are expected to begin operating the building in March 2028.
