Fed Watchdog Finds Mismanagement, No Crimes, in $2.4B Building Project

The Federal Reserve's internal watchdog released a report on a $2.4 billion building renovation project, finding no evidence of criminal wrongdoing but widespread mismanagement.

The inspector general's investigation, requested by former Fed Chairman Jerome Powell in July 2025, found that the Fed's Board of Governors and staff made key errors that inflated costs.

These missteps included failing to secure a comprehensive cost estimate at the start of the project and not setting a maximum overall cost, allowing prices to spike after construction began in 2022.

The report concluded that 'the Board has not effectively managed and executed its contract and repeatedly deviated from its cost-management provisions.'