DOJ Probe of Powell Draws Backlash from Lawmakers

Lawmakers sounded the alarm over the Justice Department’s criminal inquiry into Federal Reserve Chairman Jerome Powell, putting at risk President Donald Trump’s efforts to name a new central bank leader, Jason Ma reported for Fortune.

While Powell’s term as chair expires in May, his term as a member of the Fed’s Board of Governors runs until 2028. (Photo: Board of Governors of U.S. Federal Reserve System Facebook)

Trump has attacked Powell for much of the past year over his reluctance to cut interest rates, though the president said he did not know about the DOJ probe.

Republican Sen. Thom Tillis agreed with Powell’s assessment that Trump wants to dictate interest rates.

“It is now the independence and credibility of the Department of Justice that are in question,” Tillis said. “I will oppose the confirmation of any nominee for the Fed — including the upcoming Fed chair vacancy — until this legal matter is fully resolved.”

While Powell’s term as chair expires in May, his term as a member of the Fed’s Board of Governors runs until 2028.

When prior Fed chairs have stepped down, they have typically resigned from the board as well. Powell could choose to remain to preserve the Fed’s independence.

Sen. Elizabeth Warren, a Democrat who also sits on the Senate Banking Committee, accused Trump of trying to force Powell off the Fed board “to complete his corrupt takeover of our central bank.”

She added: “He is abusing the law like a wannabe dictator so the Fed serves him and his billionaire friends. The Senate must not move ANY Trump Fed nominee.”