The U.S. Department of Justice is investigating potential criminal misconduct by Powell related to the renovation of the Federal Reserve building. Concurrently, they have launched a separate investigation into Cook following allegations of mortgage fraud. President Trump previously attempted to dismiss Cook, and last week, he nominated Warsh to succeed Powell when his term concludes in May.
The U.S. Senate Banking Committee comprises 13 Republicans and 11 Democrats, meaning that if a single Republican senator votes against the nomination, combined with unified opposition from all Democrats, the committee would deadlock, preventing the appointment from advancing to a full Senate vote.
"We urge you to postpone any proceedings on Mr. Warsh's nomination until the criminal investigations involving Chair Powell and Governor Cook, which appear to serve some purpose, are concluded," wrote the Democratic senators, led by Massachusetts Senator Elizabeth Warren.
The letter stated, "The administration's attempt to exert control over the Federal Reserve through criminal proceedings is dangerous and unprecedented. On its face, it is absurd to allow President Trump to handpick the next Chair of the Fed while his Justice Department is conducting criminal investigations into two sitting members of the Board of Governors, not just one."
The 11 Democrats on the committee lack the votes alone to block Warsh's nomination. However, they have gained support from Republican Senator Thom Tillis, a member of the Banking Committee, who has pledged to obstruct any Fed nominations until the investigations are resolved.
Following the announcement of Warsh's nomination, Tillis stated on X, "My position remains unchanged: I will oppose any nominee for the Federal Reserve, including for Chair, until the Justice Department's investigation into Chair Powell is fully and transparently resolved."
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