Attorney General Todd Blanche said Friday that the Justice Department will not reopen its criminal investigation into former Federal Reserve Chairman Jerome Powell, closing the book on a referral that had been criminally referred to DOJ last July before being dropped in April, according to reporting first flagged by The Gateway Pundit.
"We're not reopening a criminal investigation into him," Blanche told Bloomberg in an interview Friday. But Blanche did not slam the door completely — he told the outlet that an independent audit of the Fed's renovation project could still prompt an investigation if it uncovers evidence of criminal wrongdoing.
The decision comes days after the Federal Reserve's own inspector general found no reasonable grounds to believe that a federal crime had occurred requiring a referral to the attorney general, even while faulting the central bank for what it described as major management and oversight failures that contributed to the project's soaring costs.
What Powell Was Accused Of
The underlying matter is the renovation of the Federal Reserve's Washington, D.C. headquarters, a project whose cost ballooned from $1.9 billion to $2.5 billion, per The Gateway Pundit's Cristina Laila. That explosion in price triggered the July criminal referral to the Justice Department.
The case had already been battered in the courts. Earlier this year, Judge Boasberg, an Obama appointee, quashed Justice Department subpoenas issued to Powell. In April, DOJ dropped its criminal investigation. Powell currently sits on the Board of Governors at the Fed — meaning the man whose stewardship is under scrutiny still holds an official role inside the institution he once ran.
Blanche's comments to Bloomberg add a new layer: his office, he said, intends to hold Powell accountable for mismanagement. That is a notable framing from the nation's top law enforcement officer — accountability, yes; criminal charges, not now.
The Warsh Era Begins
The timing matters. Powell is now the former chairman; Kevin Warsh has succeeded him at the top of the central bank, per The Guardian's coverage of the DOJ's decision. That means the Fed has new leadership while the wreckage of its costliest boondoggle sits on the books and an independent audit is still in the pipeline.
Blanche's remarks leave two tracks open simultaneously. The criminal track against Powell is closed unless the audit produces something. The oversight track — holding Powell accountable for mismanagement — is not.
That distinction is doing a lot of work. Democrats and their media allies will read the headline as exoneration. Blanche's own words say otherwise. "We're not reopening a criminal investigation" is not the same sentence as "no wrongdoing occurred," and the inspector general's report specifically declined to clear the management decisions that drove the cost overruns.
What It Means for the Fed's Independence
The episode also raises a structural question Americans should be asking: how does a renovation project run nearly a billion dollars over budget at an institution that prints money, and nobody faces a criminal referral that survives contact with a courtroom? Judge Boasberg's quashing of the subpoenas and DOJ's April withdrawal already answered part of that. Friday's announcement finishes it.
Blanche did not rule out future Justice Department action. If the pending independent audit finds evidence of criminal wrongdoing, the calculus could change. Until then, Powell's exposure is reputational and civil — not criminal.
The Fed itself, meanwhile, has been found by its own watchdog to have committed "major management and oversight failures." That finding stands no matter what DOJ does next.
Our Take
Read that Blanche quote again. Not "we found no crime." Not "he's cleared." What the attorney general said was that Justice is not reopening a criminal investigation — and that accountability for mismanagement is still the plan. Those are two different things, and the legacy media is already blending them into one convenient headline for Powell's defenders.
Here's the part that ought to infuriate every taxpayer: a $600 million cost overrun at the Federal Reserve, an Obama-appointed judge killing the subpoenas, and a criminal referral that quietly died in April. The inspector general's report doesn't say Powell is clean — it says the Fed's management failed badly on his watch and there wasn't enough to refer a crime. Those are not the same finding, and the difference is exactly where the accountability question now lives.
The Fed is supposed to be independent. Fine. Independent isn't the same as unaccountable, and it was never supposed to mean untouchable. A central bank that can blow through a billion dollars in overruns with zero criminal exposure has a problem that no inspector general report is going to fix.
Blanche kept the audit door open. Patriots should be watching what that audit finds — and whether the next DOJ has the spine to act on it. Because the swamp doesn't drain itself, folks. It just gets a new coat of paint — at $2.5 billion and counting.
