Federal Reserve Moves to Block Subpoenas for Chair Jerome Powell Amid Criminal Probe

The Federal Reserve is mounting a closed-door legal effort to block grand jury subpoenas issued by the U.S. Justice Department to Chair Jerome Powell, according to sources familiar with the matter. Powell disclosed in January that the subpoenas were part of a criminal investigation tied to his June 2025 testimony before the Senate Banking Committee regarding a long-running renovation project at the Fed’s headquarters. While the probe raised the possibility of criminal charges, no indictment has been filed so far.

In sealed court proceedings, the Fed is challenging the legality of the subpoenas and seeking to have them quashed, though details of its legal arguments remain undisclosed due to grand jury secrecy rules. The controversy centers on cost overruns in the renovation project, which officials in the Trump administration had previously criticized as excessive. Powell, however, told lawmakers that claims of lavish upgrades were “misleading and inaccurate,” denying reports of luxury additions such as special elevators, water features, or rooftop gardens.

The dispute comes amid a prolonged clash between President Donald Trump and the central bank over interest rate policy, with the president repeatedly urging rapid rate cuts to stimulate economic growth. Powell has argued that the criminal investigation is a pretext designed to pressure the Fed and undermine its independence, while U.S. Attorney for Washington, D.C., Jeanine Pirro said legal action became necessary after the Fed failed to respond to inquiries about the renovation costs. Powell’s term as chair ends in May, though he could remain on the Fed’s board until 2028.

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