A leading Republican lawmaker is pushing back against efforts to sideline Federal Reserve Chair Jerome Powell, asserting there is no basis to treat his actions as criminal—even as a Justice Department investigation complicates the confirmation process for the incoming Fed chair nominee. The dispute has sparked political friction in Washington and slowed the Senate’s ability to move forward on a key economic appointment.
Scott Rebukes Criminal Allegations Against Powell
Senate Banking Committee Chair Sen. Tim Scott firmly stated that Powell “has not committed a crime” in relation to his congressional testimony about the Federal Reserve’s costly headquarters renovation, now the subject of a rare DOJ probe. Scott criticized Powell’s performance during testimony but emphasized that poor execution doesn’t equate to unlawful behavior, standing up for Powell amid growing controversy.
Scott said he believes prosecutors would reach the same conclusion if consulted, underscoring that political disagreement shouldn’t transform into criminal consequences. His remarks underscore mounting Republican unease over the Justice Department’s actions, which critics see as politically motivated.
Nomination of Successor Hits Snags in Senate
The Trump administration’s nomination of Kevin Warsh as the next Federal Reserve chair has hit roadblocks. Republican Sen. Thom Tillis has vowed to block Warsh’s confirmation until the ongoing investigation into Powell is fully resolved, potentially grinding the Senate Banking Committee to a halt. Tillis argues that confirming a new Fed leader while a criminal inquiry looms could undermine the institution’s credibility.
At the same time, Democrats on the committee have also called for delaying Warsh’s nomination, saying it’s inappropriate to move forward during legal uncertainty. Many lawmakers, from both sides, have expressed concern that the controversy could weaken public confidence in the Fed’s independence.
Broader Backlash and Central Bank Independence Concerns
The DOJ’s investigation into Powell — centering around his statements about a multi-billion-dollar Fed renovation project — has drawn criticism from leaders across the political spectrum. Some lawmakers say the probe appears to be politically charged pressure, especially at a time when the Federal Reserve’s decision-making on interest rates remains central to economic policy debates.
Amid these tensions, Powell’s current term as Fed chair ends in May, though he remains on the board until 2028, adding another layer of complexity to succession plans.
