Fed watchdog finds renovation failures, but no grounds for criminal referral

Description: The Federal Reserve’s inspector general found significant mismanagement but no criminal misconduct in the renovation of the Fed’s headquarters, whose projected cost grew to about $2.4 billion.

The report said the project began without a comprehensive cost estimate or maximum spending limit, while poor project and contract management contributed substantially to the cost overruns.

The findings are significant because President Donald Trump and members of his administration had used the renovation costs as part of pressure against then-Fed Chair Jerome Powell, including a Justice Department investigation that was later closed.

The inspector general did not find grounds for a criminal referral, although it identified deficiencies in the Fed Board’s oversight of the project, CNBC has reported.

The renovation is now expected to be completed no earlier than December 2027, while current Fed Chair Kevin Warsh has said the central bank will make management changes, including transferring project oversight to the General Services Administration and hiring an independent auditor.

read more: https://www.cnbc.com/2026/09/30/fed-inspector-general-report-powell-trump.html

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