From The New York Times:
Prosecutors Make Surprise Visit to Fed as Pirro Defends Investigation
The Justice Department’s criminal inquiry into the Federal Reserve threatens to delay the confirmation of the next chair.
Prosecutors sent by Jeanine Pirro, the U.S. attorney for the District of Columbia, made a surprise visit on Tuesday to the Federal Reserve’s construction site, which is at the center of an investigation into the central bank, according to people familiar with the matter.
The highly unusual decision to visit the Fed underscored Ms. Pirro’s intention to aggressively pursue her investigation into Jerome H. Powell, the Fed chair. Mr. Powell has been targeted by President Trump, who has blasted the chair for refusing to slash interest rates far below where they stand today.
Mr. Trump’s push to investigate Mr. Powell, who has fiercely defended the Fed’s independence, appears to be colliding with the reality that the Pirro-led investigation imperils chances of quickly confirming a successor when Mr. Powell’s term ends on May 15.
On Tuesday, the Senate Banking Committee announced it would hold a confirmation hearing next week for Kevin M. Warsh, Mr. Trump’s pick to replace Mr. Powell. The hearing will proceed despite the fact that a key Republican on the committee, Senator Thom Tillis of North Carolina, has said he will not advance Mr. Warsh unless the Justice Department drops the Powell investigation.
The confrontation at the Fed took place around 11 on a sunny Washington morning. Two Pirro deputies, Carlton Davis and Steven Vandervelden, were joined by Matthew Fox-Moles, a chief investigator at the department.
They approached construction workers on the site of the $2.5 billion renovation project, and were turned away because they had not requested permission to visit ahead of time and there were safety protocols to abide by.
They were told to request a visit through the Fed’s administrative office, according to a federal official who spoke on the condition of anonymity because they were not authorized to discuss an ongoing investigation.
Robert K. Hur, a former federal prosecutor hired as outside counsel by the Fed, later accused the prosecutors of trying to circumvent a federal judge’s ruling that Ms. Pirro’s investigation lacked sufficient evidence of potential criminality to proceed.
“I understand that you and Mr. Fox-Moles appeared today without prior notice at the Federal Reserve’s construction site, stated that you wished to ‘check on progress’ and asked for a ‘tour,’” Mr. Hur wrote on Tuesday in an email to Mr. Davis and Mr. Vandervelden, reviewed by The New York Times.
Mr. Hur described the thwarted tour as “inappropriate,” and asked Ms. Pirro’s office to “commit” to no similar actions without the presence of Fed lawyers.
Ms. Pirro, who has bristled at accusations that she opened the investigation to go after a Trump political adversary, gave no indications she planned to downshift.
“Any construction project that has cost overruns of almost 80 percent over the original construction budget deserves some serious review,” she said in a statement on Tuesday in response to questions about her investigators’ presence at the Fed. “And these people are in charge of monetary policy in the United States?”
Tuesday’s visit follows a number of legal setbacks for the Justice Department in its efforts to target Mr. Powell and the Fed. A federal judge recently denied the department’s request to reconsider an earlier ruling that quashed subpoenas issued to the central bank by federal prosecutors.
“There is abundant evidence that the subpoenas’ dominant (if not sole) purpose is to harass and pressure Powell either to yield to the president or to resign and make way for a Fed chair who will,” Judge James E. Boasberg wrote in his initial ruling.
Ms. Pirro has not officially appealed the decision.
Senator Tim Scott of South Carolina, who is the chair of the Banking Committee, told Fox News on Tuesday that he believed the investigation would be concluded within weeks, even though he conceded he had no evidence of that.
Scott Bessent, the Treasury secretary, told reporters separately on Tuesday that “we want Kevin Warsh in as soon as possible.”
Colby Smith covers the Federal Reserve and the U.S. economy for The Times.
Glenn Thrush covers the Department of Justice for The Times and has also written about gun violence, civil rights and conditions in the country’s jails and prisons.
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