Washington, Aug. 25 (UNI) U.S. President Donald Trump on Monday fired Federal Reserve Governor Lisa Cook over allegations that she committed mortgage fraud.
“Pursuant to my authority under Article II of the Constitution of the United States and the Federal Reserve Act of 1913, as amended, you are hereby removed from your position on the Board of Governors of the Federal Reserve, effective immediately,” Trump wrote in a letter to Cook, posted on his Truth Social platform Monday.
“The Federal Reserve has tremendous responsibility for setting interest rates and regulating reserve and member banks,” Trump wrote in the letter. “The American people must be able to have full confidence in the honesty of the members entrusted with setting policy and overseeing the Federal Reserve. In light of your deceitful and potentially criminal conduct in a financial matter, they cannot and I do not have such confidence in your integrity.”
Federal Housing Finance Agency Director Bill Pulte on Wednesday publicly accused Cook of mortgage fraud and sent a criminal referral to the Justice Department.
Trump, on the same day, called for Cook’s resignation in response to Pulte’s claims, followed by Cook’s statement in which she emphasized she had “no intention of being bullied to step down from my position because of some questions raised in a tweet.”
U.S. Congress curbed the president’s authority to unilaterally fire a Fed governor in the Federal Reserve Act of 1913, which states that the president can only do so “for cause.” But the law does not elaborate on what constitutes “cause.”
Therefore, Trump’s firing may trigger a legal showdown, which will likely lead to a legal clash that could wind up at the Supreme Court, local media reported.
The move also exacerbates concerns about the Federal Reserve’s independence under the Trump administration.
Cook was nominated by former President Joe Biden in 2022. If she comes down, Trump will be able to nominate her replacement and reshape the Fed’s governing board for the next several years, said the report.
