A $556.8 million lease that the Securities and Exchange Commission signed for offices in downtown Washington has drawn intense scrutiny from Congress and could lead the agency to lose control over its real estate decisions.

Last summer the agency signed one of the biggest and most expensive leases in Washington in recent years when it agreed to take about 900,000 square feet in Constitution Center, the renovated former headquarters of the U.S. Department of Transportation, in Southwest Washington.

The deal initially appeared to be a step toward fulfilling expectations that the Washington area would experience an economic boost from increased regulatory responsibilities. Instead, the very agency that is supposed to be reining in Wall Street’s exuberance is now having to face questions about its own unrealistic expectations for growth, as well as possible fraud or criminal violations.

Members of the House Transportation and Infrastructure subcommittee on economic development, public buildings and emergency Management attacked the lease as an ill-considered decision and a grievous waste of taxpayer dollars.

Rep. Jeff Denham (R.-Calif.) said that agency leaders had made “bad decision after bad decision, and it’s the American taxpayer that loses.”

D.C. Del. Eleanor Holmes Norton (D), the panel’s top Democrat, said the agency’s conduct could “point to possible criminal violations by federal employees” for falsely representing their actions or doctoring leasing documents, after the SEC’s inspector general found that the lease was not awarded competitively and that a document formally justifying it was prepared a month after the SEC had signed the contract.

The 91-page inspector general report, released in May, found that the agency “grossly overestimated” the amount of office space it needed and might have violated federal law in inking the 10-year deal. It said the SEC was searching for about 300,000 square feet near its headquarters adjacent to Union Station when officials toured Constitution Center and quickly decided to instead take three times that amount without properly considering whether it would receive appropriations necessary to finance such growth.

Norton said at the hearing Thursday that she would submit legislation later this year aimed at stripping the agency of its power to manage its real estate decisions, a responsibility for which most federal agencies rely on the General Services Administration. Norton said the agency’s actions amount to a “gift to those who oppose Dodd-Frank,” the financial regulatory legislation that the SEC is largely responsible for implementing.

SEC Inspector General H. David Kotz told the panel that he would support stripping the agency of real estate powers if the SEC did not undertake major reforms. “Looking at the way leasing procedures have been run to date, there’s no question the leasing authority should be taken away,” he said.

After the scrutiny, the SEC has been working to unload the space it leased to other federal agencies, with some success. Jeffrey Heslop, the agency’s chief operating officer, testified that two agencies, the Office of the Comptroller of the Currency and the Federal Housing Finance Agency, had each agreed to assume portions of the lease, a total of 558,000 square feet. Those deals, Heslop said, would relieve the SEC from any obligations for that space to the building’s owner, David Nassif Associates.

The agency is looking for agencies to take over the the remaining space it leased, about 342,000 square feet. Heslop testified that given the uncertainty of appropriations in 2012 and beyond, the agency had determined that it would not need any space at Constitution Center. “To this end, SEC staff currently is working with the General Services Administration to help identify another federal government agency to fill the space,” he said.

Heslop added, however, that the agency would still need “significant additional staff” to carry out the Dodd-Frank Act. “To this end, the SEC will continue to assess its space needs in the context of its current budget and the overall resources available to the agency,” he said.