Fed Chair Powell Faces DOJ Probe, Republicans Alarmed

On January 12, 2026, the U.S. Department of Justice launched a criminal investigation into Federal Reserve Chair Jerome Powell over alleged false testimony about a $2.5 billion renovation of the Washington headquarters that began in July 2025. Powell has called the probe an intimidation tactic tied to his independent policy stance, while President Donald Trump has labeled him a "gross incompetent" and threatened legal action. Republicans—including Senators Lisa Murkowski, Kevin Cramer, and Thom Tillis—have voiced concerns about undermining Fed independence, with former chairs Janet Yellen, Ben Bernanke, and Alan Greenspan signing a letter denouncing the investigation. The case risks political pressure on U.S. monetary policy and federal institutions.