No criminality, watchdog says

Key Points:

• The Federal Reserve’s Office of the Inspector General found no evidence of federal law violations in the Fed’s $2 billion renovation project, though it criticized poor contract execution and cost management by the Fed board.
• Cost overruns were attributed to inflation, limited subcontractor bidding, design changes, and challenging site conditions, with ineffective project management extending the project's timeline and increasing expenses.
• The renovation became a political flashpoint under President Trump, who accused the Fed of lavish spending, leading to a criminal probe that was ultimately blocked by a judge due to lack of evidence.
• Fed Chair Jerome Powell denied allegations of extravagance and emphasized the importance of the Fed’s independence from political pressure amid ongoing scrutiny and threats from the Trump administration.
• Senate Banking Committee members from both parties responded to the report, with Republicans calling for continued oversight and Democrats defending Powell against what they called a politically motivated investigation.