The US justice department has initiated a criminal inquiry involving Federal Reserve Chair Jerome Powell, according to remarks he made on Sunday.
In a recorded statement, Powell said federal prosecutors had issued subpoenas to the central bank and warned of potential criminal charges linked to his testimony before a Senate panel. That testimony related to redevelopment and renovation work at Federal Reserve facilities.
Powell described the move as without precedent and suggested it followed sustained criticism from former president Donald Trump, particularly after Powell declined to cut interest rates despite repeated and public demands from Trump.
He becomes the latest figure to clash with Trump and subsequently face scrutiny from the justice department. At stake, Powell said, is the independence of the central bank. “The question is whether interest-rate decisions will continue to be driven by data and economic realities, or whether they will be shaped by political coercion,” he said.
He added that while he strongly believes in legal accountability and the rule of law, the investigation must be viewed against what he called a broader pattern of pressure and threats directed at the Federal Reserve by the administration.
Trump, speaking to NBC News on Sunday, said he was unaware of any investigation involving Powell. However, he criticized the Fed chair’s performance, saying Powell had done a poor job running the central bank and overseeing construction projects. Although prosecutors have not publicly confirmed the inquiry, its existence would mark a further intensification of the long-running feud between Trump and Powell, whom Trump originally appointed as Fed chair in 2017.
Trump has repeatedly floated the idea of removing Powell, arguing that interest rates have not been lowered aggressively enough. During the latter half of 2025, the Federal Reserve reduced rates on three occasions.
The former president has frequently attributed rising prices and living costs in the US to high interest rates and to policies pursued under President Joe Biden.
Economists and lawmakers have warned that efforts to push out the Fed chair could weaken the institution’s credibility and compromise its independence from political influence. Republican Senator Thom Tillis of North Carolina, who sits on the Senate Banking Committee, said he would block confirmation of any successor nominated by Trump, as well as other Federal Reserve board appointments, until the legal situation surrounding Powell is resolved.
Tillis said the episode erased any lingering uncertainty about attempts within the Trump administration to undermine the Fed’s autonomy. He added that the impartiality of the justice department itself was now under scrutiny.
Democratic Senator Elizabeth Warren went further, accusing Trump of trying to force Powell off the board permanently in order to install a compliant replacement and consolidate control over the central bank. She urged the Senate to halt consideration of all Trump nominees to the Federal Reserve, including any candidate for chair. According to the New York Times, which first disclosed details of the inquiry, the matter is being handled by the US attorney’s office in Washington, DC. Trump has previously pressed for criminal cases against several political opponents, despite legal experts saying such cases can be difficult to substantiate.
Earlier, he targeted Federal Reserve governor Lisa Cook, attempting to dismiss her over allegations of mortgage fraud. A federal judge blocked that move, and the issue is now scheduled for review by the Supreme Court later this month.
Both James and Comey have denied wrongdoing and argued that the cases against them were motivated by politics rather than evidence.
Leave a Reply