DOJ drops criminal probe of Fed Chair Powell

[0:00] The Department of Justice is dropping its investigation into Federal Reserve Chair Jerome [0:05] Powell. The DOJ launched the probe in January after President Trump accused the man he appointed [0:11] of mishandling $2.5 billion in a building renovation. Evan Perez is joining us now with [0:19] the reporting. So what was the reasoning that Jeanine Pirro, the U.S. attorney, gave for [0:26] dropping this case? Well, the off-ramp that she's using is that she's asking the Federal Reserve [0:33] Inspector General to produce a report which she says she'll review and at the end of that [0:38] will determine whether there is reason for her to restart an investigation. But for now, [0:43] this is ending. And Dana, this has not been a normal investigation. I'll give you a couple of [0:48] examples. The fact is that the FBI has not been involved in this. This has been handled by a [0:53] couple of political appointees in Jeanine Pirro's office. These were folks who actually showed up [1:00] at the Federal Reserve headquarters at the construction site to take a personal look at it [1:05] just in the last couple of weeks. And they were turned away. You'll remember that they issued a [1:11] subpoena to the Federal Reserve to try to get to some of these records. The Federal Reserve challenged [1:16] that. And the federal judge actually agreed with them because they found that the Justice Department [1:22] said that they had no evidence to support this investigation. And despite the fact that the [1:28] department said that they were going to appeal, Pirro said she was going to appeal, they never [1:33] actually did. So that really kind of made it clear, at least to Tom Tillis and some of the other [1:38] Republicans on Capitol Hill, that this wasn't really about an investigation, that this was more [1:43] about pressure from the President on Jerome Powell because obviously he's been pressuring him [1:49] to lower interest rates. And you saw some of that play out in the last few days at Kevin Warsh's [1:55] nomination hearing, where Tillis made it clear that that nomination was going nowhere while this [2:02] investigation remained pending. So it was a matter of time. We heard from Pirro on X this morning. [2:09] She said that she will not hesitate to restart a criminal investigation should the facts warrant doing [2:17] so. We don't anticipate that that is going to be the case so long as Jerome Powell leaves office [2:23] when his term ends next month. Absolutely fascinating. Evan, thank you so much for bringing [2:28] us that news. And back here at the table, first I just want to drill down on the Jerome Powell of it [2:34] all. And then I want to talk more broadly about the President trying to use the Justice Department [2:39] to go after people he perceives as his enemies. Tom Tillis, Evan referred to this, [2:44] he is a senator from North Carolina retiring. So he is definitely in his almost retirement era. [2:52] And that means that what he is trying to do is push boundaries on a whole lot of issues. [2:58] This issue in the confirmation hearing for the next Fed chair, Tom Tillis made clear he's not going to let [3:07] that go anywhere until the Trump administration drops the investigation that they ended up doing [3:14] just today. Listen to that. The problem that I have here is that we had some U.S. attorney with a dream [3:23] or assistant U.S. attorney thinking it would be cute to bring Chair Powell under an investigation [3:28] just a few months before the position was going to be open. Let's get rid of this investigation so I can [3:36] support your confirmation. You know, talking to the same Republicans I've talked to up on Capitol Hill [3:42] about this on the Senate side, that's actually how most of them felt, which is like, can we get [3:46] done with this investigation so we can get going with Warsh and get the Fed going? Tom Tillis, as you [3:52] said, in his retirement era or near retirement era, is the one that sort of made a stand on this. [3:56] I think it was a pretty smart move for John Thune and Tim Scott to schedule this hearing because I [4:04] think that is what unlocked this moment when Warsh performed well at the hearing. It kind of allowed [4:11] this moment of the president. I don't know if he instructed Janine Pirro or if Janine Pirro read [4:15] the room and understood like this had to be folded in order for this to move. And after seeing how he [4:22] performed, they were ready to have this movement. Yeah, that's such that was inside politics. [4:29] Can we also just talk about the big picture here? Okay, so now I think we have a list of the people [4:35] that the president had definitely wanted to retaliate against and that were under investigation. [4:45] And so far, you see on the left, James Comey and Letitia James. That hasn't worked. The indictment [4:53] was dismissed. We don't know what's going to happen with John Bolton. As of an hour ago, [4:58] you can take Jerome Powell off the list, at least under federal criminal investigation. [5:05] And, you know, there are Democrats who the White House or the administration, the DOJ in particular, [5:13] tried to go after. Remember Mark Kelly in particular, because of a fight with the Department [5:20] of Defense, and a grand jury wouldn't allow that. They said no. So there are some guardrails that [5:29] continue to show themselves in the third branch of government, the judicial branch, as the president [5:37] tries to push the boundaries. Yeah, and you see Democrats really leaning on the judicial branch [5:42] now that they are out of power. I think fundamentally, though, this goes back to the dismissal of Pam [5:46] Bondi, the former attorney general, because the president felt, according to folks who I talked [5:51] to, that not enough was being done to get folks who he believed were a part of targeting him or had [6:00] just done things that he believed that he wouldn't be able to get away with and putting them under [6:05] indictment. And so he dismissed her. And now we have Attorney General Todd Blanche, who we are seeing [6:10] not in certainly in those indictments that we saw on the screen, but seeing in other ways, [6:14] trying to move quicker to do the things that President Trump wants to do as he tries to [6:18] vive for a permanent job. I mean, on the Tillis versus Powell thing, I was asking White House [6:24] officials just last week, how does this resolve itself? Because it was very clear that Tillis [6:28] would not drop his being against it. And they didn't really have any answers. Folks who I talked [6:34] to outside of the White House said that it would be incumbent upon the president to move on. But [6:39] they felt that Jeanine Pirro, I mean, of course, she is watching and seeing what Trump is doing [6:44] and how he's operating with Pam Bondi. But they felt that she was acting a lot on her own. And so [6:49] we'll see whether or not Pirro, you know, goes after another person. [6:53] And real quick, Jamie, you brought up Todd Blanche, because he's in an audition phase right now. [6:59] Absolutely. He wants to be Attorney General. So he's, you know, I want to add two quick things. [7:05] There were some grand juries who declined to bring cases. So go grand juries. I also want to [7:12] go back to Tom Tillis for a quick second. A lot of Republicans have retired. They haven't all stood [7:18] up to President Trump. And so I think, you know, he gets credit for that. It's also a reminder to [7:25] other Republicans. It works. You can do it. Last month, a federal judge quashed Pirro's subpoenas, [7:32] stating in his ruling that they were an attempt, quote, to harass and pressure Powell either to [7:37] yield to the president or to resign and make way for a Fed chair who will. Just two days ago, [7:43] Pirro said she would not drop the case despite presenting zero evidence of wrongdoing. [7:50] The cost overruns on that building are well over a billion dollars. This investigation continues. [7:59] I am in the legal lane. There are others who are in the political lane. I don't intersect those two [8:06] lanes. I am going forward. We're joined now by former federal prosecutor Barrett Berger. Barrett, [8:13] what's your reaction to this announcement? I mean, it's surprising to see DOJ walk away from [8:20] an investigation that they had been very public about and one in which the president had seemed to [8:25] be encouraging. However, given Judge Boesberg's decision last month, essentially saying that [8:32] prosecutors couldn't get the grand jury subpoenas that they were asking for because they hadn't [8:37] presented any actual evidence that there was a crime that had been committed. I guess the writing [8:44] may have been on the wall, given the judge's decision there. You know, it's interesting to hear [8:48] Janine Pirro saying that she retains the right to bring charges in the future if the inspector [8:56] general returns anything. You know, I think that's probably not likely to happen here. I think if they [9:03] had had some sort of evidence that there had been a crime committed, they probably would have brought [9:08] charges in the first place. Theoretically, though, if there were some evidence to pop up, what would it [9:14] need to look like to restart a criminal investigation like this? Yeah, so from the [9:20] outset, this investigation was focused on misstatements that Powell was alleged to have made to [9:27] Congress about this renovation project. These are incredibly hard cases to bring because you have to [9:32] show that he intentionally lied to Congress about something that was material. You can't just find a [9:39] slight mistake in his words or something that he may have slipped up and you have to have that criminal [9:45] intent element. So unless they were able to uncover additional evidence that they were not able to [9:52] present last month to Judge Boesberg, if they were able to find that they could theoretically bring a [9:57] case against him for these misstatements. But the inspector general will do a review. They have been [10:04] doing a review. This is not a new inquiry. The IG has publicly said that they've already been looking into this. [10:11] So the IG could theoretically bring either civil matter or refer this to federal prosecutors if [10:18] they found some evidence of criminal intent here. And we hear Pirro saying that she doesn't really cross [10:24] the streams with the political. You know, she's in the legal lane. She's saying that. But of course, [10:29] the backdrop of all of this is that you have a senator who is refusing to confirm the president's pick for [10:35] the new chair unless DOJ drops this and you have this big hearing and then all of a sudden this is [10:44] dropped. I wonder if you really are seeing judicial independence here or independence from her office [10:51] or if you do see the political interference. Well, I think right from the get go, there's been [10:56] political interference with this investigation. You had the president who had been berating Powell [11:02] for months before DOJ announced this investigation, trying to get him to lower interest rates. And so [11:09] many said that this investigation was merely an attempt for the president to try to impose his will [11:16] on the Fed, really taking away some of the independence that the Fed has historically enjoyed. [11:21] So I think that this investigation right from the beginning has been plagued with the sort of sting of [11:26] politics. And certainly the context in which it's been dropped now doesn't help that.