Fed Chair Powell Under DOJ Scrutiny Over $2.5B Eccles Building Renovation Scandal

July 21, 2025 – Federal Reserve Chairman Jerome Powell faces a Department of Justice (DOJ) referral from Rep. Anna Paulina Luna (R-Fla.) over alleged perjury tied to the $2.5 billion renovation of the Federal Reserve’s Marriner S. Eccles Building. Amid growing pressure from the Trump administration, Luna accuses Powell of lying about the project’s lavish features and ballooning costs, raising questions about his leadership and the Fed’s independence.

Perjury Allegations Fuel Controversy

Luna’s DOJ referral, first reported by Fox News, claims Powell misled Congress during a June 25, 2025, Senate Banking Committee hearing. Powell denied plans for extravagant additions like VIP dining rooms, private elevators, rooftop gardens, and premium marble in the renovation. Luna alleges these statements are false, citing project details that contradict his testimony. If proven, perjury could result in up to five years in prison and significant fines.

The renovation, initially budgeted at $1.9 billion in 2019, has surged to $2.5 billion due to rising material costs, labor shortages, and historic preservation mandates. Office of Management and Budget Director Russell Vought has criticized the project as “wasteful,” alleging Powell violated the National Capital Planning Act (NCPA) by deviating from approved plans.

Trump Administration’s Clash with Powell

The Trump administration has intensified its focus on Powell, driven by disputes over interest rate policies amid concerns about inflation from Trump’s tariff plans. President Trump has labeled the renovation a “scandal” and suggested it could justify Powell’s removal for “fraud,” though he later noted firing him before his May 2026 term end is “unlikely.” Vought is pushing for an on-site inspection to verify Powell’s claim that luxury features were eliminated.

The Federal Reserve has countered with a new FAQ page and a video tour on its website, defending the renovation as essential for modernizing the 1930s-era Eccles Building and a neighboring property acquired in 2018. The project addresses critical issues like asbestos removal and outdated systems, the Fed claims.

Powell Defends Project, Faces Investigations

Powell has denied the perjury allegations, stressing that the project is overseen by the Federal Reserve’s Board of Governors and was audited by its inspector general in 2021. In response to recent criticism, he requested a new review by Inspector General Michael Horowitz to examine costs and compliance. Powell clarified that no VIP amenities or private elevators are included, and original marble is being reused to reduce costs. He also noted the Fed’s voluntary coordination with the National Capital Planning Commission (NCPC), despite not being subject to its authority.

Implications for Fed Independence

The controversy has sparked concerns about the Federal Reserve’s autonomy. JPMorgan Chase CEO Jamie Dimon warned that targeting Powell could destabilize markets. Legal experts argue that firing Powell would require clear evidence of misconduct, which the renovation allegations may not satisfy. The Supreme Court has suggested Fed board members are protected from dismissal over policy disagreements, complicating efforts to remove him.

With the DOJ reviewing Luna’s referral, supported by figures like Bill Pulte of the Federal Housing Finance Agency, and the inspector general’s investigation underway, this scandal could reshape Powell’s tenure and the Fed’s future.

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Keywords: Jerome Powell, Federal Reserve, DOJ investigation, Eccles Building renovation, Trump administration, perjury scandal, Fed independence, National Capital Planning Commission, inflation concerns