Tim Scott hopes Fed Chair Powell investigation ‘goes away’ for Warsh

Sen. Tim Scott said Wednesday he hopes the federal investigation into Federal Reserve Chairman Jerome Powell will “go away” so the Senate can nominate Kevin Warsh, President Donald Trump’s pick, to replace U.S. central bank chief.

Scott, who chairs the Senate Banking, Housing and Urban Affairs Committee, said in his speech on CNBC’s “Squawk Box” program, “This course of events ensures that the Fed is fully functioning and returning to its target.” he said.

Sen. Thom Tillis, R-N.C., vowed to detain Fed nominees pending the outcome of the federal criminal investigation into Powell. Trump floated the idea of ​​firing Powell last year and lashed out at the Fed chairman for refusing to cut interest rates as much as he wanted. Powell has denied any wrongdoing and said she was targeted because she refused to comply with Trump’s demands.

Scott said Powell, whose term as president ends in May, was expected to testify before Congress on February 11, but missed that date due to the federal investigation.

“I talked to Jay about his statement,” Scott said. “I recommended that he appear before the committee.”

“He’s more involved with the criminal case at this point,” he said. “And I understand that.”

Congress can compel an elected official to testify, but the Banking Committee did not do so with Powell in this case.

The Fed declined to comment on whether Powell declined to testify.

Tillis otherwise supports Warsh. Trump was nominated He applied for the job in January but doubled down on the blockade after meeting with the Fed nominee on Tuesday.

“This isn’t about people, it’s about process,” Tillis said. “I think it was a foul.”

“This is a fundamental principle of the Fed’s independence,” Tillis told reporters on Tuesday. “I have no idea what the market reaction would be if suddenly there was a perception that the Fed chairman was catering to the president’s pleasure.”

Sen. Kevin Cramer (R.N.D.), another Banking Committee member, told CNBC earlier Wednesday that he predicted some Democrats might support Warsh’s nomination.

“There’s essentially no reason in terms of anything he’s said or done that Democrats shouldn’t support his candidacy,” said Cramer, who is scheduled to meet with Warsh on Wednesday. “Of course they’re going to be very thorough in interviewing him and cross-examining him during his trial. But I think we need to be on track to get him across the finish line so that there’s no gap between the end of Jay Powell’s term and the beginning of the new one.”

Sen. Jim Banks, R-Ind., a member of the Banking Committee, said he spoke with Warsh on Wednesday and asked the Senate to confirm him immediately.

“President Trump’s Federal Reserve Chairman Nominee, Kevin Warsh, understands the importance of lowering high costs and interest rates for working families. He has the experience to do it, and the Senate should confirm him ASAP!” Banks said in a statement: Publish on X It included a photo of the senator and Warsh.

The investigation into Powell is based in part on testimony Powell gave to the Senate Banking Committee last year. Scott has said in past testimony that he does not believe Powell committed a crime, and he repeated that view Wednesday. He said the Senate would begin confirmation hearings for Warsh “as soon as possible.”

“At the end of the day … he was absolutely unprepared when he went before the committee,” Scott said of Powell. “Unfortunately, I think he was unprepared. But he did not commit any criminal act while before the committee.”

— Steve Liesman contributed to this report.