TLDR
- Jerome Powell is accused of lying under oath about the Fed’s $2.5B headquarters renovation cost increase.
- Rep. Anna Paulina Luna referred Powell to the DOJ for alleged perjury tied to Senate and OMB statements.
- The Fed renovation budget rose from $1.9B to $2.5B due to material costs and underground work, per Fed reports.
- Trump and allies are pressing Powell to cut rates by 300 basis points amid low inflation and stable jobs data.
Federal Reserve Chairman Jerome Powell has been criminally referred to the Department of Justice by Republican Representative Anna Paulina Luna. The referral comes at a time when President Donald Trump and his allies are pushing for a sharp interest rate cut from the Fed.
Allegations Tied to Fed Headquarters Renovation
Today, Rep. Anna Paulina Luna confirmed she submitted a criminal referral to the DOJ, accusing Powell of providing false information under oath. Her claims focus on Powell’s testimony regarding the Federal Reserve’s $2.5 billion renovation project for its Eccles Building headquarters.
According to Luna, Powell misled both the Senate and the Office of Management and Budget about the scope and costs of the project. In June, Powell told the Senate Committee on Banking that the changes to the renovation budget were minor. However, Luna argued that internal documents reviewed by congressional staff showed otherwise.
🚨 BREAKING: Jerome Powell has just been referred to the DOJ for CRIMINAL CHARGES for PERJURY related to his $2.5 BILLION “renovation” to the Federal Reserve Building
Rep. Luna alleges Powell falsely downplayed the project’s $600 million cost increase, and denied luxury features… pic.twitter.com/eO5IPNHmLk
— Nick Sortor (@nicksortor) July 21, 2025
In a separate letter to OMB Director Russell Vought, Powell reportedly described the cost increase—from $1.9 billion to $2.5 billion—as minor. Luna said this mischaracterization formed the basis of her referral, claiming Powell’s statements could qualify as perjury.
Rising Pressure From Trump and Allies
The referral comes amid renewed political pressure for the Federal Reserve to reduce interest rates. President Donald Trump has called for a 300-basis-point rate cut, criticizing Powell for not acting faster. He also reposted reports about the renovation allegations on Truth Social, calling on Powell to resign.
Trump’s allies, including Federal Housing Finance Agency Director Bill Pulte, have also weighed in. Pulte accused Powell of deceptive testimony and encouraged Congress to investigate. These statements helped fuel Luna’s decision to escalate the matter legally.
Although Trump has previously considered removing Powell, he recently suggested that the criminal allegations could force the Fed Chair to step down on his own.
Renovation Details Under Scrutiny
The Fed’s renovation plan was originally approved in 2017, with an estimated cost of around $1.9 billion. Over time, that estimate rose to $2.5 billion. According to the Federal Reserve, the increase was due to rising costs of materials like steel and cement, as well as underground construction work.
The Board of Governors said the project has been subject to yearly budget reviews. They also stated that the Fed’s independent Office of Inspector General (OIG) has full access to monthly construction reports.
Still, critics claim that luxury items like VIP dining areas and custom elevators were part of the upgrades, though Powell has denied these claims. Amid growing concerns, Powell has asked the Fed’s Inspector General Michael Horowitz to review the project, including cost details and any irregularities.
Fed Rate Decision Ahead as Legal Questions Mount
While the DOJ has not yet responded to Luna’s referral, the matter could influence public and political sentiment around Powell’s leadership. The Federal Open Market Committee (FOMC) is set to meet again on July 30. However, the chances of a rate cut at that meeting remain low due to the strong labor market data from June.
According to the CME FedWatch tool, there is a 97.4% probability that interest rates will stay the same in July. Analysts say the chance of a cut in September is rising, currently estimated at 56.1%.
Jerome Powell has not publicly addressed the criminal referral. The DOJ has not issued a formal statement.
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