(WASHINGTON) — The Justice Department investigation into Federal Reserve Chairman Jerome Powell is drawing backlash from former Federal Reserve and Treasury officials as well as current members of Congress, including those in President Donald Trump’s own party.
A bipartisan group of top economic officials released a blistering statement on Monday calling the probe an “unprecedented attempt to use prosecutorial attacks to undermine” the central bank’s independence.
“This is how monetary policy is made in emerging markets with weak institutions, with highly negative consequences for inflation and the functioning of their economies more broadly. It has no place in the United States whose greatest strength is the rule of law, which is at the foundation of our economic success,” read the statement from Alan Greenspan, Ben Bernanke, Janet Yellen, Tim Geithner, Jacob Lew, Hank Paulson and others.
The investigation, announced by Powell in a rare video message on Sunday, is related to Powell’s testimony last June about the multi-year renovation of the Federal Reserve buildings in Washington. But Trump has made Powell a frequent target of his attacks and push to cut interest rates.
White House National Economic Council Director Kevin Hassett, who is on Trump’s short list to be the next Federal Reserve chair, said time will tell if the probe is a pretext for firing Powell over interest rates.
“Well, in the fullness of time, we’ll find out whether it looks like a pretext,” Hassett, who denied involvement in the probe, told CNBC in an appearance on Monday. “But right now, we’ve got a building that’s got, like, dramatic cost overruns and, you know, plans for the buildings that look inconsistent with the testimony. But, you know, again, I’m not a Justice Department person. I hope everything turns out OK.”
Republican Sen. Thom Tillis, who serves on the Senate Banking Committee, said he will oppose the confirmation of any Trump nominee to the Federal Reserve until legal matters concerning Powell are resolved, which could make it difficult for a nominee to advance out of committee.
“If there were any remaining doubt whether advisers within the Trump Administration are actively pushing to end the independence of the Federal Reserve, there should now be none. It is now the independence and credibility of the Department of Justice that are in question,” Tillis said in a statement on Sunday night.
Republican Sen. Lisa Murkowski, in a post on X on Monday, said Tillis is “right in blocking any Federal Reserve nominees.”
“After speaking with Chair Powell this morning, it’s clear the administration’s investigation is nothing more than an attempt at coercion. If the Department of Justice believes an investigation into Chair Powell is warranted based on project cost overruns — which are not unusual — then Congress needs to investigate the Department of Justice. The stakes are too high to look the other way: if the Federal Reserve loses its independence, the stability of our markets and the broader economy will suffer,” Murkowski posted on X.
House Financial Services Chairman Rep. French Hill, a Republican, said pursuing criminal charges against Powell is “an unnecessary distraction.” Sen. Kevin Cramer, another Republican on the Senate Banking Committee, said that he does not believe Powell is a criminal and that he hopes the criminal matter will soon be put to rest.
House Speaker Mike Johnson told reporters on Monday that “if the investigation is warranted, then they’ll have to play that out.” When pressed if he believed the probe is warranted, Johnson said, “I have not reviewed his testimony, so I am not sure, but that’s not really my lane.”
A spokesperson for Attorney General Pam Bondi said Bondi “has instructed her U.S. Attorneys to prioritize investigating any abuse of taxpayer dollars.” Powell said in his statement the probe was fueled by Trump’s monthslong pressure campaign on him to lower interest rates.
Sen. Elizabeth Warren, the top Democrat on the Senate Banking Committee, slammed Trump as a “wannabe dictator” over his campaign against Powell.
“Acting like the wannabe dictator he is, Trump is trying to push out the chairman of the Federal Reserve Board and complete his corrupt takeover of America’s central bank so that it serves his interests, along with his billionaire friends,” Warren said in a speech about the future of the Democratic Party ahead of 2028 at the National Press Club.
President Trump denied any involvement in the criminal probe during a brief interview with NBC News on Sunday night but continued his criticism of Powell’s leadership.
ABC News’ Lauren Peller contributed to this report.
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