In an extraordinary video Sunday night, Federal Reserve Chair Jerome Powell said he had been served with grand jury subpoenas as part of a criminal investigation into his testimony about the Fed’s Washington, DC, headquarters.
While much has been made over whether the probe is a pretext for President Donald Trump to remove Powell as Fed chairman, far less attention has been paid to what Powell actually said in the June Senate testimony that sparked the Justice Department investigation.
While criminal probes and grand jury hearings are tightly guarded secrets, here is what we know so far:
At the June hearing, Powell got into a heated exchange with Sen. Tim Scott, the Republican chair of the Senate banking committee, who criticized the Federal Reserve for “lavish renovations” of its main offices.
Powell’s responses to Scott’s questions prompted one of Trump’s allies in the House of Representatives to send a criminal referral to the Justice Department, accusing Powell of perjury.
In one of the statements singled out by Rep. Anna Paulina Luna as potentially perjurious, Powell said one of the Federal Reserve’s buildings never had a “serious” renovation. Luna said the building was renovated between 1999 and 2003.
Luna also accused Powell of making a false statement during an exchange with Scott when Powell denied the Federal Reserve would implement some of the more opulent-sounding features it had previously planned.
At the Senate hearing, Scott pressed Powell with questions about a planning document that said the central bank’s historic Marriner S. Eccles building would install “rooftop garden terraces” and “ornate water features,” as well as new elevators for board members to take to a “VIP dining suite.”
Powell dismissed Scott’s comments about the project as “flatly misleading.”
The Eccles building had been using the same elevator since the building was built in the 1930s, he said. Other issues Scott raised were “no longer in the plans,” Powell told him.
“There’s no special elevators. There are old elevators that have been there,” he said. “There are no new water features. There’s no beehives, and there’s no roof terrace gardens.”
A testy Senate testimony
Powell testified before the Senate Banking Committee in June, following the Federal Reserve’s semiannual report, where he discussed the challenges of using interest rates to combat inflation, which he said could remain high due to Trump’s tariff policies.
Aside from his criticism of the central bank’s slow movement on interest rates, Scott criticized the more than $2 billion plan to renovate the Eccles building and the 1951 Constitution Avenue building. He said the changes to those offices “feel more like they belong in the Palace of Versailles.”
Powell told senators that the Eccles building had long been in need of renovation for safety reasons. The renovation began in 2022 and is overseen by members of the Federal Reserve board, who are all confirmed by the Senate. Trump nominated Powell himself in his first term in 2017.
“When I was the administrative governor, before I became chair, I came to understand how badly the Eccles building really needed a serious renovation,” he said. “Never had one. It was not really safe and it was not waterproof.”
The following month, Luna said Powell had broken the law by perjuring himself and making false statements to Congress.
She sent a criminal referral to Attorney General Pam Bondi, asking the Justice Department to open an investigation into the Federal Reserve chairman.
It isn’t clear if Luna’s referral formed the basis for the ongoing criminal investigation into Powell. A representative for the US Attorney’s Office in Washington, DC, declined to comment.
Luna’s letter appeared to refer to a 2021 planning document that Scott had asked Powell about.
In the hearing, Powell told Scott that the plans had “continued to evolve.”
He said the project had already scrapped some plans for luxurious-sounding features and would be thrifty with building materials.
“There’s no new marble,” he said. “We took down the old marble, we’re putting it back up. We’ll have to use new marble where some of the old marble broke.”
A two-page fact sheet on the Federal Reserve’s website about the renovations of the two historic buildings reiterates what Powell said. “No new VIP dining rooms are being constructed as part of the project,” “There is no VIP elevator,” “There are no new water features,” some bullet points read.
Representatives for Luna didn’t immediately respond to Business Insider’s request for comment.
Luna also said Powell lied to Congress when he said the Federal Reserve’s Eccles building had “never had” a “serious renovation.”
“This statement is also false,” Luna wrote. “The Federal Reserve Board conducted a comprehensive renovation of the Eccles Building from 1999 to 2003, which included the replacement of the roof, all major systems, and a full refurbishing of interior and courtyard spaces.”
Luna accused Powell of making another false statement to Office of Management and Budget Director Russell Vought when he wrote a letter saying changes to the construction plans were intended to “simplify construction and reduce the likelihood of further delays and cost increases.”
Trump has denied knowing about the DOJ’s probe, but he has not been shy about voicing his dissatisfaction with the Federal Reserve for not lowering interest rates faster.
He has said he would like to fire Powell, and made the unusual move of announcing plans to select Powell’s replacement ahead of the expiration of Powell’s 10-year term in 2028. Trump has also attempted to fire Lisa Cook, a Biden appointee on the Federal Reserve board, in a case that will be heard before the Supreme Court next week.
The Federal Reserve’s renovation plans have irked Trump, who complained about the project’s cost during a July tour of the construction site with Powell and Scott.
In his statement Sunday, Powell said the Justice Department subpoena “should be seen in the broader context of the administration’s threats and ongoing pressure.”
“This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings,” he said, adding, “Those are pretexts.”
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