House Democrats Seek Probe of DOJ Criminal Investigation Into Fed Chair Powell
House Democrats led by Rep. Jamie Raskin and Rep. Jared Moskowitz have formally asked Judiciary Chairman Jim Jordan to open a congressional inquiry into the Trump Justice Department’s criminal investigation of Federal Reserve Chair Jerome Powell, calling it a "sham" probe and a "systematic assault" on central‑bank independence. Their letter urges Jordan to hold public hearings and consider subpoenaing Attorney General Pam Bondi and other DOJ officials after Powell revealed Sunday that prosecutors were threatening indictment over his June 2025 Senate testimony on costly renovations of the Fed’s headquarters. The investigation is being run by U.S. Attorney Jeanine Pirro in Washington, who says Powell ignored repeated outreach about cost overruns and insists "indictment" has been raised only by Powell, not her office. Powell argues the real aim is to bully the Fed into cutting interest rates faster in line with President Trump’s public demands, while Trump denies ordering the probe but continues to attack Powell as "not very good" at the job. The clash has already rattled lawmakers in both parties, raising fresh alarms about politicization of the Justice Department and the erosion of the Fed’s traditional insulation from White House pressure at a time when it is still managing inflation and rate cuts.
📌 Key Facts
- Raskin, Moskowitz and other House Democrats sent a letter asking Chairman Jim Jordan to investigate DOJ’s criminal probe of Fed Chair Jerome Powell.
- Democrats label the investigation a "sham" and a "systematic assault" on Federal Reserve independence, saying it is meant to coerce rate cuts aligned with Trump’s wishes.
- U.S. Attorney Jeanine Pirro says her office contacted the Fed multiple times about building‑renovation cost overruns and Powell’s testimony and only turned to legal process after being ignored, denying that DOJ has threatened indictment.
- Powell publicly stated Sunday that DOJ was "threatening a criminal indictment" related to his June Senate Banking testimony and tied the probe to the Fed’s refusal to bow to Trump’s rate‑cut pressure.
- Trump told NBC and Reuters he did not direct the investigation, though he continues to criticize Powell’s performance and has not ruled out firing him.
📊 Relevant Data
President Richard Nixon pressured Federal Reserve Chairman Arthur Burns to implement expansionary monetary policies, including lower interest rates, in the lead-up to the 1972 election, which contributed to high inflation in the 1970s.
How Richard Nixon Pressured Arthur Burns: Evidence from the Nixon Tapes — Journal of Economic Perspectives
In 2025, Black homeownership rates increased but still trailed White rates significantly, with Black applicants facing a 21% mortgage denial rate and Hispanic applicants a 17% rate compared to 11% for White applicants; higher interest rates can exacerbate these disparities by increasing borrowing costs, making homeownership harder for groups with lower baseline rates.
Black Homeownership Rate Sees Largest Annual Increase Among Racial Groups But Still Trails White Homeownership Rate — National Association of Realtors
As of mid-2025, unemployment rates remained higher for Black (around 7%) and Hispanic (around 5.5%) workers compared to White workers (around 3.5%), according to Federal Reserve data; interest rate hikes by the Fed can slow economic growth and increase overall unemployment, disproportionately impacting groups with higher baseline rates.
Monetary Policy Report – June 2025 — Federal Reserve Board
The Federal Reserve's renovation project for its headquarters buildings saw costs escalate from an initial estimate of $1.9 billion to $2.5 billion due to unforeseen issues such as lead paint and asbestos removal.
Peek Inside the Federal Reserve Renovations at the Core of a DOJ Probe — Business Insider
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