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Criminal Investigation Launched Against Fed Chair Amidst Clash with Trump

Published January 12, 2026, 07:19
Criminal Investigation Launched Against Fed Chair Amidst Clash with Trump

US prosecutors have launched a criminal investigation into Federal Reserve Chairman Jerome Powell regarding a $2.5 billion renovation of the central bank's headquarters, escalating the conflict between the Trump administration and the US central bank. Powell stated on Sunday that the Fed received subpoenas and a threat of criminal investigation from the Department of Justice, linked to his testimony to Congress about the renovation project. He believes this legal move is an attempt to restrict the Fed's independence in setting monetary policy. Donald Trump has repeatedly attacked Powell, accusing him of refusing to lower interest rates. Powell argues that the investigation is a result of the Fed's effort to set rates based on the public interest, not the president's preferences. Donald Trump denies any involvement in the Justice Department's investigation. This case highlights the tension between political power and the independence of the central bank.