Fed Watchdog Clears Renovation Project of Criminality, Blames Mismanagement

The Federal Reserve's internal watchdog, the Office of Inspector General (OIG), released a report finding no evidence of criminal wrongdoing in the central bank's $2.4 billion headquarters renovation project.

The renovation, which became a flashpoint between the Fed and the Trump administration last year, was initially budgeted at $1.3 billion in 2020 but saw costs surge due to missteps in management.

The OIG report identified a series of deficiencies in the project's management, including the failure to establish a guaranteed maximum price until July 2025, four years after the project began.

Fed Chairman Kevin Warsh responded by saying the central bank would implement the OIG's recommendations and engage an independent auditor to scrutinize all awarded costs to date.