The Federal Reserve is asking a court to throw out subpoenas issued as part of the Justice Department’s inquiry into Fed Chair Jerome H. Powell and the central bank’s renovations of its building, according to a person familiar with the matter.
The motion to quash the subpoenas has not been made public because it is under court seal.
U.S. Attorney Jeanine Pirro, the top federal prosecutor in D.C. and a close ally of President Donald Trump, last year opened an investigation into whether Powell gave misleading testimony to Congress last summer on the Fed’s $2.5 billion renovation of its headquarters overlooking the National Mall. Trump and some other Republicans have questioned the building’s amenities and rising costs.
A grand jury issued subpoenas to the Fed seeking records or testimony about the renovation, with a Jan. 29 deadline, The Washington Post has reported.
Trump initially appointed Powell as Fed chair during his first term in the White House, then soured on the central bank leader over his handling of interest rates.
Powell has denied wrongdoing. After the subpoenas were issued, Powell publicly revealed the investigation’s existence and called it an attack on the Fed’s independence on matters of monetary policy.
Attorneys for the Fed have filed legal papers in U.S. District Court in D.C. requesting that a judge quash the subpoenas, according to a person familiar with the matter, who spoke on the condition of anonymity because the motion is under seal. The motion was first reported by the Wall Street Journal.
Spokespersons for the Fed and Pirro’s office declined to comment.
The investigation of Powell follows other Justice Department moves against officials Trump has railed at. Pirro’s office this month tried to indict six Democratic lawmakers who have criticized the Trump administration, but that effort was rebuffed by a grand jury. The Justice Department charged former FBI director James B. Comey and New York Attorney General Letitia James in Virginia, but those indictments were dismissed on the grounds that the Trump-picked U.S. attorney who brought them had been illegally appointed.
The extraordinary probe into the head of the central bank, which has drawn criticism from Democrats and Republicans, has become a significant political problem for Trump. The president has nominated Kevin Warsh to replace Powell, whose term as Fed chair expires in May. But a key Republican senator has said he will not allow a vote on Warsh until the investigation ends.
Sen. Thom Tillis (R-North Carolina) has said he won’t support any Fed nominee until the Justice Department probe into Powell is fully resolved.
Other Republicans have also rejected the idea that Powell committed a crime.
“I do not believe that he committed a crime during the hearing,” Sen. Tim Scott (R-South Carolina), the chair of the banking committee, said of Powell’s testimony in an interview with Fox Business’s Maria Bartiromo this month.
“I don’t think that he belongs in a federal courtroom or a federal penitentiary,” Sen. Kevin Cramer (R-North Dakota), another member of the banking panel, said of Powell on CNBC.
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