The Federal Reserve's inspector general concluded that renovations of the central bank's headquarters in Washington, D.C., weren't well-managed, but there was no evidence of criminal misconduct.

After more than a year of review, the inspector found in a report dated Tuesday that the Fed's Board of Governors failed to take actions that would have mitigated significant cost overruns.

But while the Board's internal project governance was deemed insufficient to manage such a complex project, the IG found no evidence of wrongdoing.

"At no point during our evaluation did we find reasonable grounds to believe that a violation of federal criminal law had occurred requiring a referral to the U.S. Attorney General in accordance with the Inspector General Act," the report said. "Further, while our report outlines deficiencies in the management of the renovation project, resulting in our recommended corrective actions in accordance with the Inspector General Act, we did not identify administrative misconduct during our evaluation."

After huge cost overruns and delays emerged for the renovations of the Marriner S. Eccles and 1951 Constitution Avenue NW buildings, former Fed Chair Jerome Powell requested an assessment in July 2025. The board initially approved a budget of $1.3 billion in February 2020 that grew to $2.4 billion by December 2024.

The renovations, which are still not complete, have been the subject of scrutiny from the Trump administration, with officials sending letters to the Fed and Powell, specifically, demanding answers for the delays and ballooning budget.

Earlier this year, U.S. Attorney Jeanine Pirro opened a criminal investigation into Powell's actions regarding the project, but later closed the inquiry in April to clear a path for the Senate to vote on his successor, Kevin Warsh. Powell, whose term as chair expired in May, previously said he would stay on at the Fed as governor until the IG investigation was complete.

The White House did not immediately respond to a request for comment regarding the report.

The IG review found that multiple factors, including design changes, soil instability, and inflation, contributed to the construction cost increases.

The IG report recommended negotiating a final guaranteed maximum price on the project, capping construction manager fees, as well as auditing all costs and evaluating contract deliverables for potential reimbursements. Additionally, the IG recommended overhauling capital project governance.

Fed Chairman Warsh concurred with all of the IG's recommendations and said in a letter to the IG that the General Services Administration will serve as a partner to oversee the project from here to bring the renovations to a "speedy and successful conclusion."