Tim Scott on DOJ probe into Powell: ‘I do not believe that he committed a crime’ in Fed HQ testimony

Senate Banking Chair Tim Scott on Wednesday said he did not believe Federal Reserve Chair Jerome Powell committed a crime during his congressional testimony last year about the central bank’s headquarter renovations.

“I was the one asking the questions,” he said on Fox Business. “Jay Powell was responding to me. Obviously, he and I have very, very strong disagreements on many issues, everyone.”

He said it was time for a new head of the central bank and called Powell “inept” but added: “ineptness or being incompetent is not a criminal act.”

“I believe what he did was made a gross error in judgment,” Scott said. “He was not prepared for that hearing. I do not believe that he committed a crime during the hearing.”

The Justice Department issued subpoenas last month to the Fed, probing his statements to Congress, a fact revealed by Powell himself in an unprecedented video message where he accused the administration of using the investigation to pressure him to lower interest rates. Sen. Thom Tillis (R-N.C.), saying he fears for the Fed’s independence, has said he will not vote to advance any Fed nominees until the administration has finished its probe.

Scott said the issue would be “resolved,” adding: “Thom Tillis will be voting for Kevin Warsh as the next chairman of the Federal Reserve.”

Tillis has spoken positively of Warsh but said his stance regarding the DOJ investigation has not changed.

Scott’s comments mark the first time that the powerful banking head has substantively weighed in on the administration’s move.