US DOJ Opens Criminal Investigation into Fed Chair Jerome Powell
Synopsis
Federal Reserve Chair Jerome Powell announced Sunday that the Department of Justice has opened a criminal probe into his 2025 Senate testimony about the central bank’s $2.5 billion headquarters renovation. Powell called the grand jury subpoenas “unprecedented,” claiming they are retaliation for his refusal to lower interest rates to President Trump’s liking. While the investigation centres on the construction project, Powell insists the charges are a pretext to undermine the Fed’s independence ahead of his term ending in May 2026.
In an extraordinary escalation in the battle between the White House and the U.S. central bank, Federal Reserve Chairman Jerome Powell admitted on Sunday, January 11, 2026, that he is under criminal investigation by the Department of Justice. This breaking news on DOJ Powell Investigation has caused major concerns.
On Friday, grand jury subpoenas were “served on the Federal Reserve,” according to Powell. Jeremy Powell Investigation prosecutors are reportedly probing whether Powell understated the costs and scope of a multibillion-dollar renovation of the Federal Reserve’s headquarters in Washington, D.C., during testimony he gave before a Senate committee in June 2025.
Jerome Powell Calls the Case “Political Revenge”
In a rare and firm video statement, Jerome Powell said the inquiry was “unprecedented” and described the legal allegations as a “pretext” for political retaliation. He claimed the true motivation behind the investigation is his resistance to cutting interest rates as quickly and deeply as President Donald Trump has demanded.
“We’re not going to be influenced or changed by political considerations,” Powell said. “We do our work in a strictly nonpolitical way, based on detailed analysis, and nothing will cause us to deviate from that.” He added that the threat of criminal charges is “a consequence of the Fed doing its job” and warned that this move is an attempt to intimidate the central bank and strip it of its independence.
The Renovation Scandal at the Centre of the Investigation
At the heart of the case is a $2.5 billion renovation of the Federal Reserve’s main offices, a project criticised by the Trump administration for exceeding its initial budget by roughly $700 million.
• The Allegation: Critics, including the Office of Management and Budget, claim the project was “grossly mismanaged” and that Powell may have misled Congress about its luxury features and true costs.
• Powell’s Defence: Powell maintains that the Fed made every effort to keep Congress informed. While asserting that “no one is above the law,” he argued the investigation is being used as a political weapon to force the Fed to shift its monetary policy.
A Year of Rising Tensions
This probe is the culmination of a year-long feud. President Trump has repeatedly attacked Powell, labelling him “Too Late” for his cautious approach to interest rate cuts. While the Fed lowered rates three times in 2025, the White House still accused Powell of acting too slowly.
Neither the White House nor the DOJ has commented publicly on the fed chair criminal inquiry. However, the news has already shaken financial markets and reignited debate over the Federal Reserve's independence. Powell’s current term as chair ends in May 2026, but this investigation could trigger a major political showdown well before then.
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