DOJ Subpoenas Federal Reserve in Probe Involving Chair Jerome Powell

The U.S. Federal Reserve has been served with subpoenas by the Justice Department as part of a criminal investigation related to testimony given by Chair Jerome Powell, escalating tensions between the central bank and the Trump administration. Powell confirmed that the subpoenas were issued last Friday and warned that the threat of criminal charges represents an unprecedented attempt to pressure the Fed over its policy decisions, particularly interest rates. He said the probe stems from his June testimony before the Senate regarding renovations to Federal Reserve office buildings, which the administration has repeatedly criticized.

Powell emphasized that while no public official is above the law, the investigation must be viewed in the broader context of ongoing political pressure on the Federal Reserve. He argued that the administration’s actions are aimed at influencing monetary policy decisions, rather than addressing genuine legal concerns. According to Powell, the allegations surrounding the building renovation are being used as a pretext to challenge the Fed’s independence and intimidate its leadership.

The dispute comes as President Donald Trump has intensified his criticism of Powell and the Federal Reserve, demanding lower interest rates amid rising affordability concerns for Americans. Although the Fed cut rates three times last year, Trump has continued to accuse Powell of mismanagement and has publicly called for his removal. Powell, however, made clear that he has no intention of stepping down and will continue to serve out the term confirmed by the Senate, stressing his commitment to evidence-based decision-making.

President Trump denied any knowledge of the Justice Department’s investigation and rejected claims that it was intended to pressure the Fed. At the same time, senior White House officials have accused Powell of misleading Congress over cost overruns tied to the Fed’s headquarters renovation. The Federal Reserve has stated that it has asked its inspector general to review the project and noted that the institution is funded through its own revenues, not taxpayer dollars.

The developments have sparked concern among lawmakers about the erosion of central bank independence. Republican Senator Thom Tillis said the subpoenas raise serious doubts about whether the administration is attempting to undermine the Fed, adding that he would oppose confirming any new Fed nominees until the issue is resolved. Financial markets showed limited immediate reaction, though the U.S. dollar weakened slightly and stock futures dipped, while gold and silver rose as investors sought safe-haven assets.

The investigation adds to a broader pattern of scrutiny faced by the Federal Reserve under the Trump administration, including a separate Justice Department probe into mortgage fraud allegations against Fed Governor Lisa Cook, which she has denied. Together, these actions have intensified debate over the balance between government oversight and the independence of one of the world’s most influential central banks