Federal Reserve Chair Jerome Powell Referred to DOJ Over $2.5B Eccles Building Renovation Allegations

July 21, 2025 – Federal Reserve Chairman Jerome Powell faces a Department of Justice (DOJ) referral for alleged perjury tied to the $2.5 billion renovation of the Federal Reserve’s Marriner S. Eccles Building. The referral, initiated by Rep. Anna Paulina Luna (R-Fla.), accuses Powell of misleading Congress about the project’s costs and lavish features, intensifying scrutiny from the Trump administration.

Allegations of Perjury and Mismanagement

Rep. Luna claims Powell provided false testimony during a June 25, 2025, Senate Banking Committee hearing, where he denied the inclusion of extravagant additions like VIP dining rooms, private elevators, rooftop gardens, and premium marble in the renovation plans. Luna’s letter to the DOJ, first reported by Fox News, alleges these statements contradict project details, accusing Powell of two instances of lying under oath. Perjury carries potential penalties of up to five years in prison and fines.

The renovation, initially budgeted at $1.9 billion in 2019, has ballooned to $2.5 billion, a $600 million overrun attributed to rising material costs, labor shortages, and compliance with historic preservation guidelines. Critics, including Office of Management and Budget Director Russell Vought, have labeled the project “ostentatious,” alleging Powell mismanaged funds and violated the National Capital Planning Act (NCPA) by deviating from approved plans.

Trump Administration’s Push for Accountability

The Trump administration has escalated its pressure on Powell, primarily over his refusal to cut interest rates amid concerns about inflation from Trump’s tariff policies. President Trump has publicly criticized the renovation, calling it “disgraceful” and suggesting it could justify Powell’s removal for “fraud.” While Trump later stated it was “highly unlikely” he would fire Powell, the administration’s focus on the renovation has fueled speculation of a pretext to oust him before his term ends in May 2026.

White House officials, including Vought, are seeking an on-site inspection of the Eccles Building to verify Powell’s claims that features like rooftop gardens and VIP amenities were scaled back or eliminated. The Federal Reserve has responded with a new FAQ page and a video tour on its website, defending the project’s necessity to modernize the 1930s-era buildings and address issues like asbestos and outdated systems.

Powell’s Defense and Inspector General Review

Powell has denied perjury allegations, emphasizing that the project is under oversight by the Federal Reserve’s Board of Governors and was audited by its inspector general in 2021. Following recent criticism, Powell requested a fresh review by Inspector General Michael Horowitz to examine the project’s costs and compliance. The Fed maintains that the renovation, which includes the Eccles Building and a neighboring property acquired in 2018, is essential for safety upgrades and operational consolidation.

In a letter to Vought, Powell clarified that no VIP dining rooms or private elevators are being constructed, and salvaged original marble is being reused where possible. He also noted that the Fed voluntarily collaborated with the National Capital Planning Commission (NCPC), despite not being subject to its direct authority.

Political and Economic Implications

The controversy has sparked debate over the Federal Reserve’s independence, with critics like JPMorgan Chase CEO Jamie Dimon warning that undermining Powell could destabilize markets. Legal experts argue that firing Powell for cause would require evidence of malfeasance, a threshold they believe the renovation allegations do not meet. The Supreme Court has signaled that Fed board members have protections against dismissal over policy disagreements, complicating any attempt to remove Powell.

As the Trump administration continues its probe, the referral to the DOJ by Rep. Luna, echoed by figures like Bill Pulte of the Federal Housing Finance Agency, underscores the political tension surrounding the Fed’s operations. The outcome of the DOJ investigation and the inspector general’s review could have significant implications for Powell’s tenure and the Federal Reserve’s autonomy.

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Keywords: Jerome Powell, Federal Reserve, DOJ referral, Eccles Building, renovation controversy, Trump administration, perjury allegations, National Capital Planning Commission, interest rates, Fed independence