US Department of Justice launches criminal investigation into Fed Chairman Jerome Powell
The United States Department of Justice has launched a criminal investigation into Federal Reserve Chairman Jerome Powell. He made the announcement in a video message on Sunday, 11 January 2026, and described the situation as an unprecedented threat to the independence of the US central bank, ABCnews.
Powell said his investigation is focused on his Senate testimony on the multi-year effort to restore the Federal Reserve buildings in Washington, which is projected to cost $2.5 billion. This means that the testimony could be wrong and the costs of the modernisation inaccurate
At the same time, the Fed chairman stressed that the real purpose of the investigation is to put political pressure on the administration of President Donald Trump, which continues to insist on faster interest rate cuts. Powell says the question is not just about what he personally bears, but whether policymakers who manipulate monetary policy based on politics - or any other form of intimidation - can continue to do so. The problem, he said, is that the risk of criminal prosecution is based on the regulator's independence in setting the interest rate - it should have a dual mandate of price and employment stability
The US Department of Justice has confirmed that the Attorney General has instructed federal prosecutors to pay special attention to potential misuse of budget funds. Meanwhile, officials at the ministry declined to share details about the ongoing investigation
Trump himself said he had nothing to do with the investigation, but again attacked Powell for his high interest rates and budget overruns for the reconstruction. The investigation provoked a strong reaction from Congress. Some senators threatened the Fed's independence and said they would block potential candidates for the regulator's leadership until the legal process is completed
Powell's term as chairman of the Federal Reserve will expire in May 2026; he will also remain a member of the Board of Governors until 2028
Photo: Jerome Powell ABCnews.
