Sen. Tim Scott, Republican from South Carolina and chairman of the Senate Banking, Housing and Urban Affairs Committee, during his confirmation hearing on Thursday, October 30, 2025, in Washington, DC, USA.
Eric Lee | Bloomberg | Getty Images
Sen. Tim Scott (RS.C.) said Wednesday that he does not believe Federal Reserve Chairman Jerome Powell committed any crimes when he testified before the Senate last year, despite an ongoing Justice Department investigation centered on his testimony.
Mr. Scott, chairman of the Senate Banking Committee, also predicted that Republican Sen. Thom Tillis of North Carolina would lift the blockade on Kevin Warsh, whom President Donald Trump nominated to replace Mr. Powell as Fed chairman.
In an interview with CNBC’s “Squawk Box” on Wednesday, Tillis doubled down on his vow not to vote to remove Warsh from the Banking Committee until the Powell investigation is dropped.
Scott initially criticized Powell in an interview on FOX Business Wednesday morning.
“I believe the time has come for a new[Fed]chairman. Thank God Almighty. We are preparing to get a new chairman,” he said.
“I found him to be incapable of doing his job,” Scott said of Powell. “But being incompetent or incompetent is not a criminal act.”
Scott pointed out that the questions asked of the Fed chairman at a Banking Committee hearing last June were the same ones that are currently being scrutinized by the Trump administration.
“I think what he did was a serious error in judgment. He was unprepared for that hearing,” Scott said.
But “I don’t think he committed a crime during the hearing,” he said.
Although the comments have been met with criticism, they serve as a defense for Mr. Powell, who has frequently criticized President Trump for increasing pressure on the Fed to cut interest rates more quickly.
The remarks were among Mr. Scott’s first comments on Mr. Powell’s criminal investigation since the central bank chairman disclosed its existence more than three weeks ago.
President Trump said on Monday that the investigation into Powell, led by Washington U.S. Attorney Jeanine Pirro, “should be carried through to the end and see what happens.”
He also attacked Tillis, a member of the Banking Committee who is retiring from office at the end of his term in January next year. If Mr. Tillis sides with all 11 Democrats on the committee who oppose Mr. Warsh, he could block the Fed nominee from proceeding to a formal vote in the Senate.
In an interview with CNBC, Tillis said he was prepared to continue the bloc “for the remainder of this Congress if necessary to get to the truth” and keep the Fed independent of executive branch influence.
Scott, a trusted ally of Trump, praised Tillis on Fox Business as an effective member of the committee. “I appreciate that he continues to have a real open dialogue about some of the issues that concern him,” Scott said.
“I believe we can solve this problem. We will move forward and Thom Tillis will vote for Kevin Warsh as the next Federal Reserve Chairman. That’s my prediction,” Scott said. “We believe we can resolve the Jay Powell issue and move forward with strong votes from all Republicans on the committee.”
In a video address after the investigation began, Powell said the Justice Department had submitted a “grand jury subpoena to the Fed threatening criminal charges related to my testimony before the Senate Banking Committee last June.”
Mr. Powell was testifying in part about the multibillion-dollar renovation of the Washington Federal Reserve’s headquarters. President Trump has repeatedly accused Powell of incompetence or corruption over his handling of expensive construction projects.
But Powell said the threat of prosecution was “not about my testimony last June or the renovations to the Federal Reserve building.”
Rather, he said, it’s because the Fed decides to set interest rates based on “its best assessment of what will serve the public, rather than following the president’s preferences.”
