The Trump administration is under fire as “the Justice Department has opened a criminal investigation into Federal Reserve Chair Jerome Powell’s statements to Congress regarding renovations of the Fed’s headquarters in Washington” as Politico reported.
Trump already has a history of feud with Powell as he had previously called him “clueless” and tagged him as an “enemy” after taking office for his second term. Interestingly, Powell was appointed by the MAGA leader himself back in 2017. However, the Fed Chief made it to the bad books of Trump after he refused to follow Trump’s orders regarding lower interest rates.
Talking about the subpoena, Powell said on Sunday night, “I have deep respect for the rule of law and for accountability in our democracy. No one—certainly not the chair of the Federal Reserve—is above the law. But this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure.”
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He then added in a video message, “This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings. It is not about Congress’s oversight role; the Fed, through testimony and other public disclosures, made every effort to keep Congress informed about the renovation project. Those are pretexts. The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president.”
In an NBC interview, Trump, however, did not admit to knowing anything about this development. He said, “No. I wouldn’t even think of doing it that way. What should pressure him is the fact that rates are far too high. That’s the only pressure he’s got.”
The grand jury subpoenas sent on Friday to Powell are regarding his statements to the Congress about the renovations of the central bank’s headquarters, which MAGA claims to have run over budget. However, as an editorial published in the Wall Street Journal pointed out, “this is hardly the first government building project to cost more than advertised, and the Fed funds it from the central bank’s own resources rather than sapping tax revenue from Treasury.”
Moreover, the paper also got the information from sources that mentioned that reports of the renovation were prepared by Bill Pulte, an official with the Federal Housing Finance Agency. He had allegedly then passed the papers to Jeanine Pirro, a Fox News personality. Pirro had been hired by Trump last year as the U.S. attorney for D.C. and it was his office that filed the subpoena, which “Attorney General Pam Bondi no doubt signed off” WSJ reported.
It should be noted here that WSJ is owned by Rupert Murdoch, an arch-conservative media tycoon and the fact that this media outlet has also gone against this decision of sending criminal subpoenas to the Fed chief, shows how serious a fiasco the Department of Justice has created.
Senator Thom Tillis, Senate Banking Committee Member, commented on the matter, saying, “If there were any remaining doubt whether advisers within the Trump Administration are actively pushing to end the independence of the Federal Reserve, there should now be none. It is now the independence and credibility of the Department of Justice that are in question.”
BREAKING: New polling reveals that Jerome Powell is far more popular than Donald Trump. Donald Trump would hate if this went viral today. pic.twitter.com/jxoQIRWwsG
— Democratic Wins Media (@DemocraticWins) January 12, 2026
Republicans have also spoken against this move. For instance, Republican Sen. Lisa Murkowski, from Alaska, condemned the development, saying, “After speaking with Chair Powell this morning, it’s clear the administration’s investigation is nothing more than an attempt at coercion.”
The WSJ editorial also highlighted what this action by the DoJ meant for Trump, saying, “Mr Powell’s term as chairman ends in May, but his seat on the Board of Governors doesn’t expire until 2028. Mr. Powell isn’t required to leave the Fed when his chairmanship ends, and Mr. Powell may now feel he needs to stay to avoid the appearance that the White House can bully Fed officials. That would deny Mr. Trump a second appointment to the Fed Board.”
As the fiasco has started to get serious with calls for firing Pam Bondi and Bill Pulte, it now remains to be seen how the Trump administration deals with this.
