DOJ won’t drop Fed probe, will appeal Powell subpoena block: Pirro

U.S. Attorney Jeanine Pirro on Wednesday doubled down on her investigation of the Federal Reserve, even as the controversial probe endangers the confirmation of Kevin Warsh, President Donald Trump‘s pick to replace central bank Chairman Jerome Powell.

The criminal investigation centers on alleged cost overruns associated with the ongoing renovations of two historic Fed buildings in Washington. Powell has accused the DOJ of targeting him for refusing to obey Trump’s demand that the Fed sharply lower interest rates.

The probe has raised concerns about the Fed’s independence from executive-branch interference — so much so that Sen. Thom Tillis, R-N.C., has vowed to block Warsh’s nomination until the DOJ drops it.

At a press conference Wednesday morning, Pirro said she would not back off.

“The cost overruns on that building are well over a billion dollars. This investigation continues,” Pirro said.

“I am in the legal lane. There are others who were in the political lane. I don’t intersect those two lanes,” she said.

PIrro’s efforts hit a major snag last month when a federal judge blocked grand jury subpoenas, writing that a “mountain of evidence” suggested they were issued to pressure the Fed’s board.

The judge, James Boasberg, stood by his ruling in early April, starting a countdown clock for Pirro to file an appeal by May 4.

“I am going forward. We are appealing the decision of Judge Boasberg,” Pirro said Wednesday.

“The idea that a judge can stand at the door of a grand jury and tell a prosecutor, ‘You’re not allowed to go in,’ when the United States Supreme Court has said you can go into a grand jury based on rumors and suspicion, is an order that we think must be appealed, and we are continuing in this investigation,” she said.

Trump, who appointed Powell in 2017 but has since soured on the Fed chairman, has said the DOJ probe should continue, while overstating the cost of the Fed renovations.

“We have to find out why a small building cost close to $4 billion,” Trump told CNBC’s “Squawk Box” on Tuesday morning. “Somehow we have to find out how this can happen.” 

The actual cost is roughly $2.5 billion.

Boasberg’s April 3 denial of Pirro’s motion for him to reconsider his initial ruling started a 30-day countdown clock for the government to file a notice of appeal, according to the DOJ manual.

Warsh’s nomination to succeed Powell, whose term as Fed chair expires May 15, must first be approved by the Senate Banking Committee. Tillis, a member of the Banking Committee, has repeatedly stated that he will block Warsh from advancing unless the DOJ drops its probe of Powell.

The Banking Committee held its confirmation hearing with Warsh on Tuesday, and the nominee met with Senate Majority Leader John Thune, R-S.D., on Wednesday.

Since the Senate is out the week of May 4, the committee could get its first chance to vote on Warsh’s nomination during the week of May 11.