Fed watchdog finds no crime in Powell renovation saga, but Trump renews resignation demand
The Federal Reserve's Inspector General found no grounds for criminal referral or administrative misconduct over a roughly $1 billion cost overrun in a central bank renovation, but cited lax oversight. President Trump used the finding to renew his call for former Fed chief Jerome Powell's resignation.
The Federal Reserve's Office of Inspector General released a report Wednesday concluding there were no grounds for a criminal referral and no evidence of administrative misconduct tied to roughly $1 billion in cost overruns on the renovation of two historic Fed buildings in Washington. The report did, however, highlight significant oversight failures in managing the project.
The renovation's total price tag now stands at about $2.4 billion. President Donald Trump has long pointed to the ballooning costs as part of his campaign to push out former Fed chief Jerome Powell and gain greater influence over monetary policy. Trump is separately seeking to remove Fed Governor Lisa Cook over an unrelated matter.
The report stated that investigators found no reasonable grounds to believe a federal criminal law had been violated requiring referral to the attorney general, nor did they identify administrative misconduct, though they recommended corrective actions.
Powell declined to comment on the findings. Trump, writing on Truth Social, said Powell should be forced to resign from the Fed board and, if he refuses, should be sued for corruption or incompetence. Trump said he has directed Attorney General Todd Blanche to study the report and decide on next steps.
Management failures detailed
The report found that design features such as marble and water elements, often cited by critics, did not materially drive the cost overruns. Instead, the central bank failed to enforce an intended "guaranteed maximum price" contract that would have made the contractor liable for overruns. As one example, plumbing and air conditioning work ultimately cost $346 million — triple the original estimate.
The dispute is the latest chapter in a long-running feud between Trump and Powell dating back to 2018. Tensions escalated sharply in January 2026 when subpoenas issued against Powell by federal prosecutors were later quashed by a judge who found them to be a pretext for political pressure. Reaction in Congress split along party lines, with Republicans calling for stricter oversight and Democrats saying the report gives no basis to renew pressure on Powell.
