Federal Reserve Chairman Jerome Powell speaks during a news conference following a meeting of the Federal Open Market Committee at the Federal Reserve on Oct. 29, 2025 in Washington, DC.
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Federal Reserve chairman-elect Kevin Warsh arrives for his Senate Banking, Housing and Urban Affairs Committee hearing at the Dirksen building, April 21, 2026.
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Pirro said Friday that the Fed’s inspector general, an insider, had been asked to investigate cost overruns on the headquarters project, which was the basis for his criminal investigation of Powell.
The Fed chairman, and others, had said that the real reason for the investigation was to pressure Powell and the Fed to lower interest rates as Trump wanted.
“The IG has the authority to hold the Federal Reserve accountable to the American taxpayer,” Pirro said in his post.
“I expect a complete report soon and I hope that the result will help to resolve, once and for all, the questions that led this office to issue the summons,” he said.
“Therefore, I have ordered my office to close our investigation as the IG conducts this investigation,” said Pirro.
“Know well, then, that I will not hesitate to restart the criminal investigation if the truth allows.”
White House spokesman Kush Desai, in a statement, said, “American taxpayers deserve answers about the mismanagement of the Federal Reserve’s finances, and the Office of the Inspector General of the most powerful authorities is in the best position to get to the bottom of this matter.”
“The White House remains as confident as ever that the Senate will promptly confirm Kevin Warsh as the next Chairman of the Federal Reserve to finally restore competence and confidence in Fed decision-making,” Desai said.
The Federal Reserve declined to comment.
CNBC requested comment from the offices of Pirro, Warsh, and Tillis, as well as Senate Banking Committee Chairman Tim Scott, RS.C., and other members of that committee.
Earlier this week, Scott, RS.C., suggested ending the criminal investigation and referring the matter to Congress.
In an interview with CNBC, Scott said that the change in the investigation is necessary to confirm Warsh as chairman, after which information related to the project can be obtained.
Scott suggested working with the House Financial Services Committee to “establish a committee to have permanent oversight of construction projects in the area under the banking committee.”
“Wherever that leads us, we have to go. If that leads to the transfer of crime, so be it,” Scott said. “But we gave Kevin Warsh at the Fed so we could access all the information needed.
Scott also said he thought Powell was “incompetent, not criminal.”
– CNBC’s Jeff Cox, Kevin Breuninger, Matt Petersonagain Emily Wilkins contributed to this article.
