Tillis hails end of Jerome Powell probe, will support Warsh for Fed chair

Sen. Thom Tillis on April 26 said he welcomed the end of a criminal probe into the sitting chair of the Federal Reserve, and was prepared to endorse the nomination of Kevin Warsh to fill that role.

Tillis, a Republican from North Carolina, had denounced the probe, which was announced in January, calling it a politically motivated step by the White House and a threat to the independence of the central bank.

While the investigation was ostensibly about cost overruns in a Fed renovation project, many observers, including Tillis, considered that pretext. President Donald Trump had repeatedly pressured Fed Chair Jerome Powell to lower interest rates, but Powell refused.

In a video recorded at the time the investigation was launched, Powell said, "This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions – or whether instead monetary policy will be directed by political pressure or intimidation.”

Trump nominated Warsh, a former Fed governor, in January, but Tillis said he would block the confirmation process until the investigation ended.

On April 24, the Justice Department said it was closing its investigation and directing the Fed’s inspector general to look into the cost overruns.

“I have been clear from the start: the U.S. Attorney’s Office criminal investigation into Chair Powell was a serious threat to the Fed’s independence, and it needed to end before I could support Kevin Warsh’s confirmation,” Tillis said in a social media post on April 26.

“I take the Department of Justice at its word: the investigation is closed, and any appeal of Judge Boasberg’s ruling will be with respect to legal principles and not for the purpose of reissuing subpoenas,” he added. Only a criminal referral from the inspector general would cause a reopening of the investigation.  

Warsh faced the Senate Banking Committee on April 21 as the first step in the confirmation process. Tillis, a member of that committee, used his allotted time to criticize the White House's pressure tactics.

The Fed's monetary policy committee is set to meet April 29.