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A group of former Federal Reserve chairs and Treasury secretaries released a joint statement defending Fed Chair Jerome Powell after he revealed the Trump administration’s Justice Department is threatening to criminally indict him over his testimony about the Fed’s renovations.
The group includes former Fed Chairs Ben Bernanke, Allen Greenspan and Janet Yellen, as well as former Treasury Secretaries Timothy Geithner and Henry Paulson, plus several former chairs of the Council of Economic Advisers who served under Republican and Democratic administrations.
“The Federal Reserve’s independence and the public’s perception of that independence are critical for economic performance, including achieving the goals Congress has set for the Federal Reserve of stable prices, maximum employment, and moderate long-term interest rates,” the group wrote.
“The reported criminal inquiry into Federal Reserve Chair Jay Powell is an unprecedented attempt to use prosecutorial attacks to undermine that independence,” they added.
“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,” the statement concluded.
Powell on Sunday released a video statement saying that the DOJ served the Fed with grand jury subpoenas on Friday that threatened a criminal indictment related to his testimony before the Senate Banking Committee about the central bank’s $2.5 billion renovation of the Fed headquarters.
FEDERAL RESERVE CHAIR POWELL UNDER CRIMINAL INVESTIGATION OVER HQ RENOVATION
The chair said that he has “deep respect for the rule of law and for accountability in our democracy,” adding that not even the Fed chair is above the law, but added that “this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure.”
“This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings. It is not about Congress’s oversight role; the Fed through testimony and other public disclosures made every effort to keep Congress informed about the renovation project,” he explained. “These are pretexts.”
“The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President,” Powell continued. “This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions — or whether instead monetary policy will be directed by political pressure or intimidation.”
TRUMP CALLS FED CHAIR POWELL A ‘FOOL,’ THREATENS LAWSUIT OVER HEADQUARTERS RENOVATION
Powell was first appointed to the Fed by then-President Barack Obama in 2012, and President Donald Trump nominated him to serve as Fed chairman in 2017 – a role he assumed the following year following Yellen’s departure from the role and his bipartisan confirmation by the Senate. He was reappointed and again confirmed as chairman on a bipartisan basis in 2022, under then-President Joe Biden.
Trump has repeatedly criticized Powell throughout his first and second terms in office and has referred to him as a “bonehead” and “stupid person” while periodically threatening to fire him. The president is prohibited by law from firing a Fed chair except in the case of a removal for cause, and has recently suggested he will wait for Powell’s term as chairman to expire in May rather than attempting to remove him.
He gave a brief interview to NBC News on Sunday and said that the DOJ’s investigation of Powell was unrelated to his calls for lower interest rates.
“No. I wouldn’t even think of doing it that way. What should pressure him is the fact that rates are far too high. That’s the only pressure he’s got,” Trump said. “He’s hurt a lot of people. I think the public is pressuring him.”
TRUMP CALLS FED CHAIR POWELL A ‘CLOWN’ AND SLAMS FED RENOVATION
Trump said on Dec. 29 that Powell is a “fool” and said that he was considering filing a lawsuit against Powell over the Fed’s renovation project, claiming the chairman demonstrated “gross incompetence” in overseeing the renovations.
“We’re thinking of bringing a suit against Powell for incompetence, because think of it, these are two – these aren’t outstanding buildings, these are small buildings. It’s going to end up costing more than $4 billion, $4 billion. It’s the highest price of construction, again Democrats, highest price of construction per square foot in the history of the world,” Trump claimed.
The project was initially estimated to cost $1.9 billion in 2019, though the estimated cost rose to nearly $2.5 billion as of 2025 due to “significant increases” in the cost of wood, steel, cement and other construction materials, as well as the cost of remediating asbestos and lead from the building, according to a report by The Wall Street Journal.
In August, Powell himself led a tour of the renovations for the president and several of his allies joined in criticizing Powell over both the renovation and monetary policy amid a concerted push to get the Federal Reserve to cut interest rates.
During a tense exchange in front of the press, Trump claimed the renovation project cost $3.1 billion and handed Powell a document including that information. Powell noted that the figure included the renovation of the McChesney Martin building, which was completed years ago and reopened in 2021. It’s unclear where the president derived the “more than $4 billion” figure he cited.
The Trump administration has also attempted to remove Fed Governor Lisa Cook after Federal Housing Finance Agency Director Bill Pulte submitted a criminal referral accusing her of mortgage fraud, which prompted a DOJ investigation.
Cook has denied wrongdoing and filed a lawsuit to block her removal, and a federal judge blocked her removal on the grounds that the president likely violated her due process rights and that the Federal Reserve statute doesn’t take into account actions by a governor committed before their tenure at the central bank, which is when the alleged fraud occurred.
Pulte has also used his position to call for Powell’s resignation. In July 2025, Pulte published a statement on the FHFA website saying he was “encouraged by reports that Jerome Powell is considering resigning.” It was unclear where Pulte obtained that information, and Powell has repeatedly insisted before and after the FHFA’s director’s move that he will remain in his role as chairman until his term expires.
Markets had a mixed reaction to the news during the early portion of Monday’s trading session. The S&P 500 started lower but recovered those losses to be trading relatively flat and up 0.1% as of early afternoon.
Gold prices rose over 2% while silver surged over 7% on the news as investors flocked to traditional safe haven assets.
