Pirro pointed out that his office is dismissing the investigation, formally opened on testimony given by Powell to Congress, into the cost of renovations to historic Fed buildings in Washington. It was a highly controversial investigation, so much so that a federal judge had ruled that grand jury subpoenas served on the Fed in January were improper, stating that evidence of criminally relevant facts was 'essentially null and void'. Pirro did not, however, rule out reopening the investigation in the future, indeed that it was prepared to do so immediately 'if conditions require it'.
Pirro indicated that an audit by the Fed's Office of Inspector General, the internal oversight body, remains open, from which he expects a 'comprehensive report' to resolve the issues 'once and for all'. The Office has been independently analysing the issue of restructuring costs since July. And White House spokeswoman Karoline Leavitt, in an attempt to downplay Trump's backtracking, referred to the inspector's activity in claiming that the administration's commitment to shedding light on the activities of the Fed's top leadership and Powell "continues". "The case is not necessarily dropped, just moved to the Inspector General. It remains a priority of the president and the investigation continues." However, the Inspector General has no powers to decide indictments.
The criminal investigation against Powell now halted had been opened after repeated violent personal attacks by Donald Trump. Democratic and even Republican sectors had called for an end to the investigation before confirming Warsh's nomination as the new central bank president.
Even during a recent Warsh hearing at the Senate Banking Committee, prior to a possible vote, Republican Thom Tillis had confirmed that he would block the nomination if the allegations against Powell, described as specious and inappropriate, were not cleared first. Without Tillis' support, the Republicans do not have the majority in the Commission to give the green light to Warsh's nomination.
It now remains to be seen whether the move, with its ambiguities, will really be enough to quickly unblock Warsh's nomination. Tillis, who had so far also demanded total transparency on the affair and not just an official end to the investigation, has so far not shown his hand. And from the Democratic opposition, Senator Elizabeth Warren said that the decision does not reassure. "Anyone who believes that Donald Trump's plot to take over the Fed is over is sorely mistaken," she said.
