Criminal Probe Launched Into Fed Chair Powell Over HQ Renovation $700M Costs

Jerome Powell is accused of misleading Congress on the cost of the Fed's headquarters renovation. Jeanine Pirro will authorise the investigation. President Donald Trump is actively assessing the issue and wants Powell fired, re-igniting the conflict between the two.

Adepu Bindu

12 Jan 2026 — 3 min read

Criminal Probe Launched Into Fed Chair Powell Over HQ Renovation $700M Costs

US federal prosecutors have initiated a criminal investigation into Jerome Powell. He has been accused of misleading Congress about the real budget for renovating the Fed’s headquarters. The renovation started in 2022 and is not yet final. Plus, the project is expected to exceed the planned budget by $700 million. President Donald Trump is actively involved in the case, re-igniting the long-running conflict between him and Powell. Trump is clearly upset and vocal in public about how the project is costing $2.5 billion and calls it a result of “incompetence.” So, how is the investigation going? Is Trump really planning to replace Powell? For all that, learn more.

What Prosecutors Are Investigating in the Powell Fed Renovation Controversy?

The controversy centres on the renovation of the Federal Reserve headquarters and its cost. The estimated costs for the renovation were lower (earlier). However, the project is now asking for $700 million more than planned. Powell is accused of misleading Congress on the real budget (in June 2025). The actual renovation involves two historic buildings (from the 1930s):

The Marriner S. Eccles Building.
A nearby building on Constitution Avenue.
Neither had ever received a full renovation before

Powell denied accusations that the renovation included luxury features like:

Private elevators
VIP dining rooms
New marble installations
Rooftop terraces

He clearly told the lawmakers that "There’s no VIP dining room; there’s no new marble.” The marble used was only to repair the damaged ones. And the work focuses on restoring old features, rather than adding luxury upgrades.

Who Is Authorising the Investigation Against Jerome Powell?

The investigation received approval in November 2025. It will be led by Jeanine Pirro, head of the US Attorney’s Office in Washington, DC. However, there's no official clarification on whether a grand jury has been formed. And if subpoenas have been issued. According to the investigation's progress, Powell’s staff have been contacted multiple times and asked to provide documents. Interestingly, she is believed to be a close political ally of President Trump.

Did the Federal Reserve Support Powell’s Claims in the Fed Renovation?

Yes, the Federal Reserve is on Powell's side. There's a detailed FAQ page published on its official site with:

Photos of the construction
Annotated planning documents
A virtual tour of the site

This can work to prove that Powell’s statements were accurate.

Is Trump Planning to Replace Powell?

For the record, the Federal Reserve is supposed to be independent of politics, but the case seems otherwise. Trump appointed Powell in 2017, who later turned against him and has publicly talked about firing Powell. However, firing isn't easy. Powell can only be removed “for cause, like serious misconduct. So, is Trump planning to replace Powell? Yes, he also told the New York Times that he has already chosen Powell’s successor. Many reports suggest that Kevin A. Hassett, Trump’s chief economic adviser, can be the one.

Final Words...

It is believed that Powell's Fed renovation controversy is part of a bigger pressure campaign on the Fed. Trump has also tried to remove Fed Governor Lisa Cook. And the world is concerned about whether legal actions are being used to influence economic policy. The time shall reveal more soon. For that, keep in touch as we cover all the updates on the same.