White House National Economic Council director Kevin Hassett has defended the Justice Department’s criminal investigation into outgoing Federal Reserve Chairman Jerome Powell.
Hassett reiterated Monday that he respected the independence of the Fed, but he contended that the public also deserved greater transparency regarding the agency.
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“I guess the question is, if you think the building cost $20 billion, or $10 billion, do you think at some point that it’s appropriate for the federal government to investigate?” Hassett told reporters during a brief press conference. “And it seems like the Justice Department has decided that they want to see what’s going on over there with this building that’s, you know, massively more expensive than any building in the history of Washington. And if I were Fed chair, I would want them to do that. I think that it’s really important to understand where the taxpayer money goes, and understand why it goes this way or that.”
Hassett, who is being considered by President Donald Trump as a possible replacement for Powell when Powell’s term as Fed chairman expires in May, described Powell as a “good person” when asked whether there had been discussions about the chairman remaining on as a governor since he has his position on the Washington-based board until 2028.
Hassett did not comment on whether Trump had been consulted regarding the Justice Department’s investigation before it was confirmed by Powell on Sunday, following reporting by the New York Times, but he did downplay any problems it may cause for the market.
“I would expect that the markets would be happy to see that there’s more transparency,” he said. “It’s something that people have been calling for for quite a long time.”
Powell confirmed the investigation over the weekend in a video statement posted to the Fed’s X social media account as one that is “a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president.”
The U.S. attorney’s office for the District of Columbia subpoenaed the Fed last Friday regarding a potential criminal indictment related to Powell’s testimony before the Senate Banking, Housing, and Urban Affairs Committee in June 2025 about overruns with respect to the $2.5 billion renovation of the agency’s headquarters in Washington, particularly its scope and cost.
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Powell, who was nominated as Federal Reserve chairman by Trump in 2017, told the committee the overruns, paid for by the Fed and not taxpayers, were due to unexpected construction challenges and inflation.
Trump and Jerome Powell have been at odds over interest rates since the start of the president’s second term in January 2025, with Trump arguing that the Fed has lowered rates too slowly, given their repercussions on housing affordability and accessibility.