Fed watchdog finds no wrongdoing in Powell’s renovation project

Investing.com -- The Federal Reserve's Inspector General said Wednesday it found no evidence of criminal activity or administrative misconduct related to cost overruns in a central bank renovation project that drew criticism from President Donald Trump and led to an investigation of former Fed chief Jerome Powell.

The watchdog's report identified significant problems with project oversight that led to roughly $1 billion in cost overruns for the renovation of the central bank's two historic buildings on the National Mall in Washington. The project now carries a price tag of about $2.4 billion.

Trump had focused on the cost overrun in his effort to remove Powell and influence monetary policy direction. Trump is also attempting to remove Fed Governor Lisa Cook over alleged wrongdoing in a separate matter.

The Inspector General's report stated that "at no point during our evaluation did we find reasonable grounds to believe that a violation of federal criminal law had occurred requiring a referral to the US attorney general."

The report added that while it outlined deficiencies in the management of the renovation project and recommended corrective actions, it did not identify administrative misconduct during the evaluation.

Fed Chairman Kevin Warsh, who replaced Powell in May, said he will follow the Inspector General's recommendations on project management and hire an independent auditor to verify accuracy and compliance of all awarded costs to date.

Trump had criticized Powell's leadership of the Fed for years, publicly attacking him for not lowering interest rates. The rising cost of the Fed renovation project became a new focus for White House attacks on Powell early in the president's second term.

Key members of the Trump administration and Republican Senator Tim Scott, the chairman of the U.S. Senate Banking Committee, suggested wasteful spending on luxury upgrades had increased the project's budget by hundreds of millions of dollars beyond earlier estimates.

Powell said the extra costs reflected unexpected challenges, including asbestos abatement and higher-than-estimated prices for materials and labor as construction went deep underground.

Original Article

You May Also Be Interested In

• Liquidia Technologies (LQDA) Falls 20%
• Under Armour Inc (UAA) call put ratio 1.8 calls 1 put with a focus on 29K contracts of September 5 puts
• Healthcare Triangle signs non-binding MOU for humanoid nursing robots