Trump Demands Powell Resign Over Fed Renovation Costs, But Watchdog Clears Him of Crime

The Federal Reserve's headquarters renovation cost taxpayers a lot more than planned.

The project was estimated at $1.3 billion back in February 2020. By December 2024, that number had climbed to $2.4 billion, according to figures cited by LiveMint and TV CN News. President Trump, in a Truth Social post, pegged the final cost at $2.5 billion or higher and predicted it could hit $3.5 to $4 billion, claiming he personally could have done the job for $25 million while preserving the buildings' historic look, as reported by Anadolu Agency.

Whether any of that is a crime, or whether it's Jerome Powell's fault personally, remains disputed. On that question, the Fed's own Office of Inspector General gave Trump nothing to work with.

The OIG report, released Wednesday, stated plainly: "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." It also found no administrative misconduct, according to CNBC and LiveMint.

The watchdog did find real problems. The Fed board didn't get a cost estimate from its construction manager until January 2026, three and a half years after construction started and after more than $2 billion had already been committed, Trump noted in his post citing the report, as relayed by Anadolu. The board also never locked in a guaranteed maximum price by July 2026, leaving the Fed exposed to cost risk instead of pushing it onto the contractor. The OIG also cited design changes, site conditions, inflation and a governance structure not built to manage a project this size and complexity.

Critically, the report does not pin those failures on Powell individually, nor on any single governor, according to Traders Union's summary of the findings. Trump's public demand is specifically that Powell be forced out.

"This is Jerome Powell's fault, and he should be forced to resign, IMMEDIATELY!" Trump wrote, adding that if Powell doesn't go, the government should sue him "for either corruption or incompetence," per Anadolu Agency. Trump also told reporters Wednesday that Powell "should not be sitting on the Federal Reserve Board" and said he'd asked Deputy Attorney General Todd Blanche to review the report. U.S. Attorney for Washington, D.C., Jeanine Pirro, is also reviewing it separately, though it's unclear how her review differs from Blanche's, and the Justice Department has not said.

The DOJ opened a criminal probe into Powell over the renovation back in January, and Powell said at the time it was pressure aimed at forcing the Fed to cut rates his way. A federal judge later quashed subpoenas in that investigation, finding their "dominant (if not sole) purpose is to harass and pressure Powell," according to CNBC. The DOJ dropped the criminal probe in April, a reversal that TV CN News reports came after a Senate Republican refused to confirm Trump's pick to replace Powell as chair unless the investigation was closed first.

Powell's term as Fed chair ended in May 2026, but he's stayed on as a governor, saying he wouldn't leave until the renovation matter reached "finality," per TV CN News.

Powell isn't the only target. Trump has also moved against governor Lisa Cook over mortgage fraud allegations she denies, and the Supreme Court ruled in June that he can't summarily remove her while litigation continues. Governor Michael Barr is also reportedly in the administration's sights over Silicon Valley Bank oversight, per Traders Union. That means Trump could, in theory, be gunning for three of the Fed's seven board seats at once.

Former Fed General Counsel Scott Alvarez told CNBC that any legal move against Powell, Cook or Barr would likely drag out for months and could backfire. "All have an incentive to litigate and stay," Alvarez said. "If they all stay while he goes on, then all he's done is hurt his own agenda."

Democratic Senator Elizabeth Warren took it further, saying the OIG report "proved that Trump's DOJ has no basis to restart the President's witch hunt against former Fed Chair Jerome Powell," and arguing Trump should "stop his chaotic tariffs" instead, according to TV CN News. That's Warren's political framing, not an established fact, and it cuts both ways: taxpayers eating a billion-dollar-plus overrun on a government building renovation is a legitimate waste-of-money story regardless of who sits in the White House.

The practical stakes are concrete. The Fed's next interest-rate decision is scheduled for Oct. 28, six days before the Nov. 3 midterm election. The administration also faces a legal deadline in the Cook case shortly after that vote. Whether Trump actually tries to remove any of the three governors, and whether the courts let him, remains an open question that will play out in filings, not in a Truth Social post.