Justice Department drops criminal probe of Fed chair Powell, likely clearing the way for Warsh
WASHINGTON (AP) — The Justice Department’s mandate is over its probe chairman of the Federal Reserve Jerome PowellIt cleared a major hurdle to the confirmation of his successor, Kevin Warsh.
U.S. Attorney for the District of Columbia Jeannine Pirro told X on Friday that her office had concluded the investigation. Fed’s extensive building renovations because the Fed’s inspector general would examine them instead.
The move could lead to a quick Senate confirmation of Warsh, the former top Fed official whom Republican President Donald Trump nominated to replace Powell in January. Powell’s term as chairman ends May 15. Republican Sen. Thom Tillis of North Carolina had said he would oppose Warsh until the investigation was resolved, effectively blocking her confirmation.
With the investigation complete, the leadership transition at the world’s leading central bank could move quickly. Republicans praised Warsh at Tuesday’s hearing, while Democrats questioned Warsh’s independence from Trump, his lack of transparency about some of his financial holdings and his reversal on interest rates. Yet Trump’s previous appointment of Stephen Miran to the Fed board was approved by the full Senate just 13 days after his nomination.
Investigation It was one of many initiatives by the Justice Department against perceived enemies of Trump. He failed to gain traction for months as prosecutors tried to establish a basis to suspect criminal conduct.
A prosecutor on the case said at a closed-door hearing in March that the government No evidence of a crime has yet been foundand a judge later overturned subpoenas to the Federal Reserve. Judge James Boasberg said prosecutors had produced “essentially zero evidence” to suspect Powell of committing a crime. Boasberg called prosecutors’ justification for the subpoena “weak and unfounded.”
Prosecutors recently made an unannounced visit to a construction site at the Fed’s headquarters but were turned away and scolded, with a defense attorney in the case calling the maneuver “improper.”
warsh said During Senate hearing On Tuesday, the President said he made no promises to the White House that he would lower interest rates, even if renewed his calls The central bank needs to do this.
“The President never asked me to commit to a particular interest rate decision, period,” former senior Fed official Kevin Warsh said under questioning by the Senate Banking Committee. “I would never agree to do that if that were the case. … If confirmed as chairman of the Federal Reserve, I will be an independent actor.”
Warsh’s comments came just hours after Trump was asked in an interview on CNBC if he would be disappointed if Warsh didn’t cut rates immediately and responded, “I would.”
The decision to drop the investigation represents a rare retreat for the Justice Department, which has moved aggressively, albeit unsuccessfully, over the past year to prosecute public figures the president dislikes.
Robert Hur, an attorney for the Federal Reserve Board of Governors, did not immediately respond to an email seeking comment Friday.
___
Associated Press Writers Michael Kunzelman and Alanna Durkin Richer contributed to this report.
___
Follow AP’s coverage of the Federal Reserve System at: https://apnews.com/hub/federal-reserve-system.
