A federal judge has dealt a setback to the Trump administration’s effort to pursue a criminal investigation into Federal Reserve leadership, rejecting a Department of Justice request to revive blocked subpoenas targeting Jerome Powell.
U.S. District Judge James Boasberg issued a sharply worded opinion denying the government’s motion to reconsider his earlier ruling, which had already blocked two subpoenas seeking Federal Reserve records.
In his decision, Boasberg said the Justice Department failed to present any new evidence or identify a legal error that would justify reversing the original ruling.
The subpoenas were tied to a broader investigation into Powell and the Federal Reserve’s headquarters renovation project, which had reportedly gone over budget. Prosecutors argued that accessing internal Fed records was necessary to determine whether any criminal wrongdoing had occurred.
However, Boasberg rejected that argument, writing that the government’s filing was insufficient and lacked substance. He described the DOJ’s submission as a “cursory brief” that did not come close to meeting the legal standard required to overturn the prior decision.
More importantly, the judge focused on the intent behind the subpoenas. He argued that the government appeared to be using its subpoena power improperly, not as part of a legitimate criminal investigation, but as a way to target Powell directly.
“No matter whom the subpoenas were addressed to … it was clear whom they sought dirt on: Powell,” Boasberg wrote, making clear that he believed the effort crossed a legal line.
The ruling represents a direct challenge to the Justice Department’s approach and reinforces limits on how prosecutorial tools can be used. Courts have consistently held that subpoenas must be tied to a valid investigative purpose, not used as a means of political or personal targeting.
The decision also comes against the backdrop of ongoing tension between President Donald Trump and Powell. Trump has repeatedly criticized the Federal Reserve chairman over interest rate policy, pushing for lower rates to support economic growth.
That context played a role in the judge’s reasoning.
By highlighting the administration’s public pressure on Powell, the ruling suggests that the investigation may have been influenced by broader policy disagreements rather than purely legal concerns, as the New York Post reported.
Despite the setback, the Justice Department is not backing down. U.S. Attorney Jeanine Pirro criticized the ruling, calling it “outrageous” and accusing the court of interfering with the government’s ability to pursue potential criminal activity. Her office has already signaled plans to appeal the decision.
An appeal could prolong the legal battle and create further uncertainty around leadership at the Federal Reserve. The situation is already affecting the timeline for confirming a potential successor to Powell, with political disputes spilling into the nomination process.
Tennessee Sen. Thom Tillis (R) has indicated he may block any new Federal Reserve nominee until the investigation into Powell is resolved, adding another layer of complexity to the situation.
For now, Powell remains in his position and has indicated he will continue serving in a temporary capacity if necessary. He has also suggested he may stay on the board until the investigation is fully resolved.
