President Donald Trump spent months attacking Jerome Powell over the Federal Reserve’s $2.4 billion headquarters renovation, accusing the central bank of waste and pushing for a criminal investigation into Powell’s testimony about the project.
Now, the Fed’s own watchdog has found no evidence that Powell committed a crime or engaged in administrative misconduct.
Instead, the 120-page report points to years of weak project management, design changes, and poor cost controls inside the Fed itself.
The project’s budget jumped from $1.317 billion in 2020 to $2.381 billion by December 2024. Construction costs alone more than doubled, from $921 million to $2.018 billion.
How the Fed Lost Control of the Project
One finding stands out. The Fed chose a contract designed to cap construction costs, yet never actually set the cap.
By July 2026, four years into construction and with more than $2 billion of work awarded, the project still had no guaranteed maximum price.
A switch from open-plan to closed offices also delayed the design by 21 months. Completion, originally expected in 2024, has now slipped to December 2027.
However, the political claims about luxury spending did not explain the overrun. Marble, fountains and a garden terrace were largely included in the original design and did not materially drive later cost increases, the watchdog found.
The Case Against Powell Is Now Over
On the criminal question, the inspector general was direct.
“At no point during our evaluation did we find reasonable grounds to believe that a violation of federal criminal law had occurred,” the report said.
It also found no administrative misconduct.
The DOJ opened its investigation in January over Powell’s 2025 Senate testimony. A federal judge later quashed the subpoenas, citing “essentially zero evidence” of a crime, before prosecutors dropped the probe in April.
Powell had promised to remain on the Fed board until the matter was finished.
“I will not leave the Board until this investigation is well and truly over, with transparency and finality,” he said in April.
That condition has now effectively been met. The next question is whether Powell stays until his governor term expires in January 2028.