Powell did not break the law with expensive Fed renovations that incensed Trump, report finds

A review by the Federal Reserve's inspector general found no evidence that Jerome Powell, then the Fed's chair, broke federal criminal law or violated board policy while overseeing the renovation of the central bank's Washington headquarters. The findings, released Wednesday, weaken President Donald Trump's claims that Powell was criminally negligent, an accusation Trump used during months of pressure on him to resign. The inspector general nonetheless faulted the board for letting the project's cost climb past $2 billion, according to CNN · NBC News.

Investigators traced the overruns to weak management: no price caps, no cost estimates required from bidding firms, loose day-to-day monitoring, and a decision to skip additional competitive bidding on some elements to keep work moving. No formal success measures existed either. The fountains, marble restoration and other features Trump and congressional Republicans had pointed to did not materially drive the increases, according to the inspector general. Responsibility rested largely with a web of internal committees rather than Powell or any individual governor. Costs have nearly doubled since 2020 estimates, and the Fed now budgets roughly $2.4 billion.

Kevin Warsh, who succeeded Powell as chair in May, agreed to carry out all seven corrective actions the inspector general proposed, among them a project audit and a hunt for recoverable costs. He also promised an independent audit of the contractor and revealed that the Government Services Administration is already reviewing the work and helping supervise its finish, an unusual role for a federal agency at an independent institution.

Summarized by PolitiKool from CNN · NBC News’s reporting. Read the full story at CNN · NBC News →