Federal Judge James Boasberg on Friday blocked the Justice Department’s efforts to subpoena documents from the Federal Reserve, issuing a scathing rebuke to prosecutors investigating the cost of renovating the central bank’s Washington headquarters. In a March 11 ruling, a U.S. district judge vacated a subpoena to the Federal Reserve Board of Governors, finding that the subpoena was improperly motivated. Documents detailing the decision were released on Friday.
“As a result, the court finds that the subpoena was issued for improper purpose and will vacate it,” Boasberg wrote.
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What did Judge Boasberg say?
In his order, Boasberg said the subpoena was not to investigate renovation costs but to pressure Federal Reserve Chairman Jerome Powell.
“There is substantial evidence that the administration issued these subpoenas to the board to compel its chair to vote for a rate reduction or resign,” the judge wrote.
U.S. Department of Justice investigation
The controversy dates back to January, when Powell revealed that the Justice Department had opened an investigation into cost overruns related to renovations of the Federal Reserve headquarters in Washington.
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The investigation is highly unusual because federal investigations into central banks are rare. Powell responded to warnings at the time that the move could be an effort to intimidate the agency and undermine its independence.
“This is about whether the Fed can continue to set interest rates based on evidence and economic conditions, or whether monetary policy will be guided by political pressure or intimidation,” Powell said.
Judge criticizes Justice Department
Boasberg’s ruling was particularly critical of the Justice Department’s case, arguing that prosecutors failed to provide meaningful evidence linking Powell to any wrongdoing.
“The government has presented essentially zero evidence that it suspects Chairman Powell committed a crime; in fact, its grounds are so weak and unproven that the court can only conclude that they are pretexts,” the judge wrote.
Jeanine Pirro responded
U.S. Attorney Jeanine Pirro quickly denounced the ruling and confirmed that the Justice Department would challenge the ruling in court.
“This is the antithesis of American justice. Exonerating anyone without any record, without investigation or questioning, is not how our criminal justice system works,” Pirro told reporters.
She added that the government would appeal.
“Friends, no one is above the law, and the U.S. Department of Justice will appeal this outrageous decision,” she said.
Tensions with the White House
The dispute comes amid longstanding tensions between the White House and the Federal Reserve over monetary policy. President Donald Trump has repeatedly criticized Powell and the central bank’s interest rate decisions.
(Using AFP input)
