On Sunday, Federal Reserve Chairman Jerome Powell disclosed that federal prosecutors have initiated a criminal investigation targeting him. The Justice Department served subpoenas to the Federal Reserve and threatened criminal indictment related to testimony Powell provided to a Senate committee regarding renovations at Federal Reserve buildings.
Powell characterized the investigation as unprecedented and politically motivated. He attributed the probe to his refusal to lower interest rates despite repeated public pressure from Donald Trump. Powell emphasized that this case reflects broader threats and pressure from the administration aimed at influencing monetary policy decisions.
The Fed chair raised fundamental concerns about institutional independence. He stated that the investigation represents a question of whether interest rates will be set based on economic evidence or determined by political intimidation. Powell expressed respect for accountability while contending that his actions should be evaluated within the context of sustained administrative pressure.
Trump nominated Powell as Fed chair in 2017 but has repeatedly threatened to remove him for resisting interest rate cuts. The president cut rates three times during the second half of 2025, yet Trump has continued blaming his predecessor Joe Biden and the Federal Reserve for American economic difficulties. Critics warn that presidential pressure undermines the Fed’s independence from political influence.
Republican Senator Thom Tillis announced he would oppose any Powell replacement nominee until the legal matter resolves, stating that doubts about Trump Administration efforts to end Federal Reserve independence should now be eliminated. Democratic Senator Elizabeth Warren accused Trump of attempting to install compliant leadership at the central bank. The investigation will be overseen by the US Attorney’s Office for the District of Columbia, according to reporting on the case.
