Donald Trump says Jay Powell should leave Fed board even though he was cleared of misconduct

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Donald Trump said former Federal Reserve Chairman Jay Powell should be kicked off the central bank’s board, even after an investigation into a $2.5 billion renovation project found no evidence of criminal wrongdoing.

The president said Wednesday that Powell, who remains on the Fed board after leaving office in May, should “be forced to resign IMMEDIATELY,” resuming his attacks on the central banker after a hiatus.

The comments come after a much-anticipated report from the Fed’s watchdog identified “management deficiencies” on a construction project at the bank’s Washington headquarters, but ruled out “administrative misconduct.”

The Fed’s inspector general criticized the central bank’s board for failing to take “the many steps at its disposal that could better control costs,” including setting a maximum price with the contractor.

But the watchdog said that “at no time during our assessment did we find reasonable grounds to believe that a violation of federal criminal law had occurred requiring a referral to the U.S. Attorney General.”

After the report was released Wednesday, Trump wrote on his Truth Social platform: “It’s Jerome Powell’s fault. »

“If he does not resign, he should be prosecuted at the highest levels by the United States government for either corruption or incompetence, both of which are completely unacceptable.”

The project has long been the focus of Trump’s attacks on the former central bank chairman, with the president claiming “criminality” was involved in the renovation of two Fed buildings in Washington. The president also visited the construction site in July 2025, criticizing Powell in front of television cameras.

Federal investigators launched a criminal investigation into Powell, which was made public in January, following allegations from Trump allies that he misled Congress about the renovations.

Powell has already denounced the Justice Department investigation as a pretext to attack him over interest rates, which Trump has repeatedly pressed the central bank to reduce. Former Fed leaders also denounced the investigation, calling it “an unprecedented attempt to use legal attacks to undermine (the Fed’s) independence.”

The investigation was abandoned in April under pressure from Republican lawmakers, with Jeanine Pirro, the U.S. attorney for the District of Columbia, referring the investigation to the Fed’s inspector general.

White House spokesman Kush Desai said Wednesday that the report “reinforces the serious mismanagement that President Trump has repeatedly highlighted by previous Federal Reserve leaders.”

Tim Scott, Republican chairman of the powerful Senate Banking Committee, welcomed the report and pledged to “continue rigorous oversight” of the central bank. “Inflation does not change the Fed’s responsibility to manage its resources prudently and be accountable to Congress,” he said.

Elizabeth Warren, the committee’s top Democrat, said the findings confirmed that Pirro and Attorney General Todd Blanche had “no basis to restart the president’s witch hunt” against Powell. Pirro’s office said it was “reviewing” the report.

The inspector general’s report reveals that the Fed board did not obtain a project cost estimate from its contractor until January 2026, more than three years after construction began. As of July, it still had not set a guaranteed maximum price.

Among its other findings were that some elements of the project had not received the required minimum of three subcontractor bids and that the council’s governance framework was “insufficient to manage a project of such scale and complexity”.

The overall cost of the renovation increased from $1.4 billion in February 2020 to $2.5 billion in December 2024, with the construction portion of the budget more than doubling to $2 billion.

Powell blamed the cost overruns on the project’s “extensive structural repairs” and remediation of asbestos and lead contamination. The project also involved an overhaul of the electrical, plumbing and heating systems.

The watchdog made a series of recommendations to the board, including establishing a guaranteed maximum price, improving governance structures and carrying out a cost audit.

Kevin Warsh, Powell’s successor as chairman, thanked the inspector general for his “thorough and rigorous evaluation of the project” and said the board agreed on “the need to complete the work in the most efficient and transparent manner possible.”

“I am determined that all of the recommendations in your report will be implemented in a systematic manner that advances the work and holds the parties accountable,” Warsh said.

He added that the federal government’s General Services Administration would be designated as “project manager” for the remainder of the project, reporting to the Fed’s board.

Additional reporting by Ella Lee in Washington and Claire Jones in Nashville