Criminal Referral Issued Against Fed Chair Powell Amid $2.5 Billion Headquarters Renovation Controversy

Top economists and central bankers are gathering in the Grand Teton mountains for the annual Kansas City Federal Reserve's economic symposium in Jackson Hole. Jerome Powell, in what is almost certainly his last appearance as Fed chair at Jackson Hole, is scheduled to speak at 8am local time (10am ET) on Friday on the topic of "Economic Outlook and Framework Review." The formal symposium theme this year is "Labor Markets in Transition: Demographics, Productivity, and Macroeconomic Policy." Powell's speech will discuss the Fed's five-year review of its monetary policy framework and will likely describe a shift away from aspects of the 2020 framework, which called for using interest rate policy to react to shortfalls in employment. The meeting comes after weeks of tension between political leadership and the central bank, including recent pressure from President Trump for interest rate cuts and criticism of the Fed for not delivering them.

On July 24, President Donald Trump visited the Federal Reserve headquarters to tour its ongoing renovation project alongside Federal Reserve Chair Jerome Powell. Trump criticized the renovation costs, claiming they had increased from the previously stated $1.9 billion to $2.5 billion, and further asserted the cost had reached $3.1 billion. He presented Powell with a document as evidence.

During the visit, a tense exchange followed. Powell corrected Trump, stating he was unaware of the $3.1 billion figure and explained that Trump's number erroneously included costs from the Martin building renovation, which was completed five years earlier, in 2021, and is not part of the current project. Powell said, "Uh, you’re including the Martin renovation," and clarified that building "was built five years ago," meaning the $3.1 billion figure combined two separate projects.

Trump responded by insisting that the Martin building renovation was part of the overall costs, while Powell firmly rejected this, stating it was "not new."

The disagreement was notable as Powell, frequently criticized by Trump in recent months over the Fed's high interest rates, publicly corrected the president on the record. When asked how he would handle a project manager who went over budget, Trump replied, "I’d fire him!"

Additionally, Trump informally urged Powell to lower interest rates during the visit, even slapping him on the back while chuckling.

This public correction marked a rare moment of open dispute between the president and the Fed chair during the renovation site tour.

On an unspecified recent date, former U.S. President Donald Trump toured the Federal Reserve's newly renovated building, which underwent a $2.5 billion renovation. During the visit, Trump publicly criticized the renovation costs and escalated his pressure campaign against Federal Reserve Chair Jerome Powell. The exchange was described as awkward and included a public spat over the expenses involved. Despite the tense encounter, Trump later insisted there was "no tension" between himself and Powell and backed off any threats to fire Powell. The meeting highlighted ongoing friction between Trump and the Federal Reserve leadership, particularly concerning monetary policy and spending decisions related to the Federal Reserve's operations.

House GOP members have issued a criminal referral against Federal Reserve Chair Jerome Powell. This move, supported by allies of former President Donald Trump, emerges amidst heightened political tensions surrounding Federal Reserve activities. Additionally, officials connected to Trump have planned a tour of the Federal Reserve headquarters scheduled for Thursday. The Federal Reserve is also undergoing a significant renovation of its headquarters, with the refurbishment costing approximately $2.5 billion. Further details on the criminal referral, specific charges, or next procedural steps were not disclosed in the content provided.

House GOP members, allied with former President Donald Trump, have issued a criminal referral against Federal Reserve Chair Jerome Powell. This action stems from controversy surrounding the Federal Reserve's $2.5 billion renovation of its headquarters, which has drawn criticism from President Trump and his team. Senator John Thune has publicly supported scrutiny of the Fed's headquarters renovations. Financial expert Douglas Bessent commented on the matter, stating that Powell does not need to resign but should conduct an internal review. Bessent further clarified that there is no reason for Powell to step down from his position at this time. Additionally, Bessent made a case to President Trump advising against firing Chair Powell. Meanwhile, broader financial news includes a drop in the Nasdaq index and earnings reports from companies such as General Motors and Raytheon Technologies.

Federal Reserve Chair Jerome Powell has defended the $2.5 billion renovation of the Federal Reserve’s historic Eccles Building in Washington, D.C., addressing concerns raised by the Trump administration. In a detailed written response, Powell explained that the 1930s-era headquarters requires critical updates to electrical, mechanical, and security systems to meet modern safety and operational standards. He emphasized that the ambitious renovation plan balances historical preservation with necessary modernization.

Powell stressed that the estimated cost reflects thorough project analysis, inflation adjustments, and the challenges of renovating a protected historical site. Importantly, he clarified that the project will be funded through the Federal Reserve’s own income, not congressional appropriations or taxpayer money. The renovation is aimed at ensuring a secure, efficient environment for the central bank’s operations, protecting both personnel and sensitive financial functions. While Powell outlined a general project timeline, he did not disclose specific milestone dates. The exchange with the White House underscores continuing political scrutiny of the Fed’s activities and expenditures.

Democratic Senator Elizabeth Warren from Massachusetts, a longtime critic of Federal Reserve Chair Jerome Powell, has emerged as a defender of the Fed amid unprecedented attacks from the Trump administration. Warren is scheduled to deliver a speech on Wednesday to a group of financial policymakers and economists at the Exchequer Club in Washington, D.C., where she plans to criticize the Trump administration's recent efforts to undermine the Fed. Specifically, Warren will address the White House and some Republican lawmakers' scrutiny over the Federal Reserve's $2.5 billion plan to renovate its Washington, D.C. headquarters, labeling the investigations into the renovation costs as attempts to bully the Fed. Warren stated, "When Trump’s initial attempts to bully Powell failed, Trump and Republicans in Congress suddenly decided to look into how much the Fed is spending on building renovations," highlighting the administration’s change in tactics. This renovation debate represents the latest point of conflict in President Trump's ongoing feud with Chair Powell over interest rates and monetary policy. Despite Warren's criticisms of Powell, she opposes the Trump administration's moves, including efforts to question the independence of the Federal Reserve or to remove Powell before his term ends next year. Warren recently co-sponsored bipartisan legislation with Republican Senator Rick Scott of Florida to enhance oversight of the Federal Reserve, proposing that the Fed’s watchdog be confirmed by the Senate. Meanwhile, Senator Bernie Moreno of Ohio, a Republican, signals alignment with some of Trump’s concerns, indicating that tariffs and interest rates might influence the selection process for Powell’s successor. The Federal Reserve’s planned $2.5 billion renovation has become a controversial symbol in this political battle, with the Trump administration seeking to investigate the expenses as a pretext for undermining Powell’s leadership. This dispute carries significant implications for the Fed’s independence, the U.S. economic agenda, and monetary policy stability. The unfolding controversy exposes tensions between the executive branch and the Federal Reserve amid uncertain economic conditions.

The controversy surrounding the Federal Reserve's $2.5 billion office renovation has escalated, with former President Donald Trump calling for Federal Reserve Chair Jerome Powell to resign immediately if he misled Congress regarding the project. The renovation, which involves the historic Eccles Building and three adjacent structures in downtown Washington, D.C., was originally budgeted at $1.9 billion in 2019 but has since increased to an estimated $2.5 billion. Powell addressed the escalating cost overruns in a July 3 letter to Senator Tim Scott (R-S.C.), acknowledging the issues and stating that Federal Reserve and Senate staff would coordinate a briefing to discuss the project in further detail. Despite Powell’s remarks, Federal Housing Finance Agency Director Bill Pulte publicly accused Powell of lying to Congress and called for a formal investigation.

The project has been under scrutiny since 2021 when the Federal Reserve’s Office of Inspector General issued an audit during the design phase, which identified significant shortcomings in oversight. The audit revealed that the Fed did not ensure that the architectural and engineering firm submitted regular progress reports and failed to formally approve schedule changes. Notably, despite the project schedule being extended by approximately two years, no formal approval was recorded. Powell previously dismissed media claims of lavish upgrades as misleading during his semiannual monetary policy report to the Senate on June 23, but the controversy remains unresolved. These developments underscore concerns about fiscal responsibility in managing public resources and have intensified calls for transparency and accountability within the Federal Reserve’s operations.