The Federal Reserve's Inspector General on Wednesday said it found no grounds for a criminal referral or evidence of administrative misconduct tied to cost overruns in a US central bank renovation project. However, its conclusion there was lax oversight drew a fresh call from President Donald Trump for former Federal Reserve chief Jerome Powell's resignation. The Fed watchdog's report highlighted extensive problems with project oversight that contributed to a roughly $1 billion cost overrun for the renovation of the central bank's two historic buildings on the National Mall in Washington.
Trump had latched onto the cost overrun on the project, which now has a price tag of about $2.4 billion, in his effort to engineer Powell's ouster and gain influence over the direction of monetary policy. Trump also is trying to sack Fed Governor Lisa Cook over alleged wrongdoing in an unrelated matter. The IG's report noted that "at no point during our evaluation did we find reasonable grounds to believe that a violation of federal criminal law had occurred requiring a referral to the US attorney general." To display this content from YouTube, you must enable advertisement tracking and audience measurement.
One of your browser extensions seems to be blocking the video player from loading. To watch this content, you may need to disable it on this site. "Further, while our report outlines deficiencies in the management of the renovation project, resulting in our recommendation of corrective actions in accordance with the Inspector General Act, we did not identify administrative misconduct during our evaluation," it added.
Powell declined to comment on the report, the latest chapter in an ongoing feud with Trump that goes back to 2018, when the president first criticised the Fed chief for not cutting interest rates. Trump had nominated Powell for the top Fed job in late 2017. "At a minimum, 'Too Late' Powell should be forced to resign from the Board.
He can’t manage a Building, and he certainly shouldn’t be allowed to manage his High Interest Rate Policy (only on “TRUMP!”)," the president wrote on Truth Social. "If he doesn’t resign, he should be sued, at the highest level, by the United States Government, for either corruption or incompetence, both of which are completely unacceptable." Trump said he had directed Attorney General Todd Blanche "to study the report, and make a determination as to what to do." Besides Powell, who led the Fed through most of the project, Fed Vice Chair Philip Jefferson heads the central bank's Committee on Board Affairs and serves as the "administrative governor" most directly involved in project oversight. To display this content from YouTube, you must enable advertisement tracking and audience measurement.
Fed Chairman Kevin Warsh, who took over from Powell in May, said he would follow the report's recommendations on project management and hire an independent auditor to "verify accuracy and compliance" of all awarded costs to date. Cost overruns on government projects are common. Trump's own budget for White House ballroom renovations, now underway, doubled from initial estimates to at least $400 million.
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