Hill, whose committee has jurisdiction over Powell and the Fed, released a statement on Monday pointing out the chairman’s history of working with Powell and calling him a “man of integrity with a strong commitment to public service.”
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Hill’s comments put him at odds with the DOJ and top White House officials, as well as President Donald Trump himself, who has regularly criticized Powell for his conduct of monetary policy. Powell has claimed that the investigation is a pretext for Trump to put pressure on him.
The pushback from Hill is notable because of his leadership of the committee, which oversees the Fed and would be most closely involved in any inquiries involving the investigation.
Hill said that despite past policy disagreements, he has found Powell “to be forthright, candid, and a person of the highest integrity.”
“Pursuing criminal charges relating to his testimony on building renovations at a time when the nation’s economy requires focus and creates an unnecessary distraction,” Hill said. “The Federal Reserve is led by strong, capable individuals appointed by President Trump, and this action could undermine this and future Administrations’ ability to make sound monetary policy decisions.”
The statement is one of the most notable denunciations of the investigation into Powell.
The Fed chairman announced Sunday night in a video statement that the Justice Department was investigating him. Powell revealed the Fed recently received grand jury subpoenas related to testimony he gave to the Senate last year about renovation cost overruns of the Fed headquarters building in Washington, D.C.
Powell flatly denied wrongdoing and suggested that the investigation is directly tied to the president’s push for the Fed to keep cutting interest rates. The investigation is unprecedented in modern history and moved markets.
“The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President,” 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.”
Other key Republicans have also come to Powell’s defense.
Most notably, retiring Sen. Thom Tillis (R-NC), a member of the Senate Banking Committee, vowed to block Trump’s nominees to the Fed and whoever he nominates to replace Powell until the legal matter has concluded.
“If there were any remaining doubt whether advisers within the Trump Administration are actively pushing to end the independence of the Federal Reserve, there should now be none,” Tillis said. “It is now the independence and credibility of the Department of Justice that are in question.”
Sen. Lisa Murkowski (R-AK) joined Tillis in a full-throated denunciation of the move and suggested an investigation into the Justice Department. Murkowski said she spoke with Powell on Monday and called the investigation “nothing more than an attempt at coercion.”
“If the Department of Justice believes an investigation into Chair Powell is warranted based on project cost overruns—which are not unusual—then Congress needs to investigate the Department of Justice,” Murkowski said on X. “The stakes are too high to look the other way: if the Federal Reserve loses its independence, the stability of our markets and the broader economy will suffer.”
Sen. Kevin Cramer (R-ND) called Powell a “bad Fed chair” in a statement, but added, “I do not believe however, he is a criminal.”
“I hope this criminal investigation can be put to rest quickly along with the remainder of Jerome Powell’s term,” he continued. “We need to restore confidence in the Fed.”
Rep. Mike Lawler (R-NY), a member of the House Financial Services Committee, also pushed back on the investigation.
“While I fundamentally believe Chairman Powell was late in addressing inflation under [President] Joe Biden and has been woefully slow in lowering interest rates over the past year, the independence of the Federal Reserve is paramount and I oppose any effort to pressure them into action,” he told Politico.
Every former living Fed chair — Ben Bernanke, Alan Greenspan, and Janet Yellen — and a bipartisan group of former Treasury secretaries and chairs of the Council of Economic Advisers also released a joint statement condemning the move.
“The reported criminal inquiry into Federal Reserve Chair Jay Powell is an unprecedented attempt to use prosecutorial attacks to undermine that independence,” they said. “This is how monetary policy is made in emerging markets with weak institutions, with highly negative consequences for inflation and the functioning of their economies more broadly.”
The White House has defended the Justice Department’s investigation into Powell. White House National Economic Council director Kevin Hassett, who is a front-runner to replace Powell, stated that he valued the Fed’s independence, but emphasized transparency at the central bank.
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“I guess the question is, if you think the building cost $20 billion, or $10 billion, do you think at some point that it’s appropriate for the federal government to investigate?” Hassett said during a press conference. “And it seems like the Justice Department has decided that they want to see what’s going on over there with this building that’s, you know, massively more expensive than any building in the history of Washington.”
“And if I were Fed chair, I would want them to do that. I think that it’s really important to understand where the taxpayer money goes, and understand why it goes this way or that,” he added.
