WASHINGTON–Former NCUA Chairman Todd Harper has issued a statement calling the Trump administration’s announcement it is investigating Federal Reserve Chairman Jerome Powell over the renovation of the Fed’s office building “deeply troubling,” saying it is a threat to the independence of financial regulation in the U.S.
Harper isn’t alone in his criticism. Every living former head of the Federal Reserve also condemned an “unprecedented” attempt by the administration to weaken the Fed’s independence.
The Justice Department last week served grand jury subpoenas on the Federal Reserve and has threatened a possible criminal indictment tied to Powell’s testimony before the Senate Banking Committee in June of 2025 over a multiyear renovation of the Federal Reserve’s headquarters in Washington that has gone well over budget. No charges have been filed.
Harper, along with NCUA Board Member Tanya Otsuka, both Democrats, was fired by Trump in April of 2025. They have filed a lawsuit seeking to be reinstated and arguing the president’s actions violated the Federal Credit Union Act. A decision in that litigation now awaits a separate but related case now before the Supreme Court.
‘Stunning & Alarming’
“INDEPENDENCE IS VITAL,” wrote Harper in a post on LinkedIn. “The latest actions of the administration against the Fed are stunning, alarming, and deeply troubling,” said Todd M. Harper, the immediate past chairman of the NCUA. “Jay Powell’s powerful message makes that point clear.
“What’s more, independent regulation of our financial institutions is a well-established precedent that began more than 400 years ago when the King of England’s actions led to a prolonged financial crisis,” Harper continued. “Independence has since been widely accepted as vital to maintaining strong economic systems and robust financial markets that serve everyone from all backgrounds not just some economic elites and political insiders.
‘Undermines Trust’
“The ongoing political pressure campaign to curb the independence of financial regulators like the Federal Reserve Board, the National Credit Union Administration (NCUA), and the Federal Deposit Insurance Corporation (FDIC) undermines the public’s trust in our markets and threatens the long-term health and prosperity of the American economy,” the statement continues. “In short, this latest troubling, unprecedented action doesn’t just raise an eyebrow, it sounds an alarm that fully threatens the future financial security and stability of all Americans. Financial regulators need to make decisions on setting interest rates based on the facts, the best economics, and legal requirements, not on the basis of political intimidation.”
Powell Responds
In a video statement released by the Fed, Powell said he has “deep respect for the rule of law,” but called the legal action “unprecedented” and a “pretext” aimed at pressuring monetary policy decisions, particularly over interest rates. “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,” Powell said.
Powell noted in the video the Fed made every effort to inform Congress about the renovation project and argued the subpoena threat was not genuinely linked to his testimony or the building work. He said he would continue to carry out his duties “with integrity and a commitment to serving the American people.”
Former Fed Chairs Blast Move
Thirteen former senior Fed officials, including ex-chairs Alan Greenspan, Ben Bernanke and Janet Yellen warned in a joint statement that similar prosecutorial attacks in other countries had led to “highly negative consequences” for the cost of living – and argued they had “no place” in the U.S.
“The reported criminal inquiry into Federal Reserve Chair Jay Powell is an unprecedented attempt to use prosecutorial attacks to undermine that independence,” a blunt statement signed by 13 former senior officials, including Greenspan, Bernanke and Yellen, 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.
“It has no place in the United States whose greatest strength is the rule of law, which is at the foundation of our economic success.”
President Denies Involvement
Trump, who repeatedly has blasted Powell for not cutting interest rates more aggressively, denied involvement in the investigation in a separate interview, saying he did not know anything about it while criticizing Powell’s performance.
As the CU Daily has reported, the investigation comes amid broader tensions over the independence of the Federal Reserve, a longstanding principle that insulates monetary policy from political influence. Trump has publicly criticized the Fed’s rate decisions and has discussed replacing Powell when his term as chair ends in May, although Powell remains on the Fed’s board until 2028.
America’s Credit Unions Responds
Asked about the investigation of Powell, Greg Mesack, SVP-advocacy with America’s Credit Unions, said it’s the trade group’s position that independent regulators are important for the strength and stability of the U.S. financial system.
“We can’t really comment on the details of any investigation going on by DOJ, but at the end of the day the U.S. financial system has benefited from strong regulation from independent regulators, and we hope to see that maintained,” he said.
