Federal Reserve Governor Lisa Cook has filed a lawsuit against President Donald Trump, escalating a clash over the independence of the nation’s central bank.
Trump announced Cook’s firing Monday, citing allegations of mortgage fraud raised by Federal Housing Finance Agency Director Bill Pulte, who accused her of listing two homes as her primary residence to obtain favorable loan terms. Pulte referred the matter to Attorney General Pam Bondi, prompting Trump to accuse Cook of “deceitful and potentially criminal conduct” in a Truth Social post.
Cook, represented by attorney Abbe David Lowell, has refused to step down. “President Trump has no authority to remove Federal Reserve Governor Lisa Cook,” Lowell said, calling the move “illegal.” The lawsuit, filed in federal court in Washington, D.C., could ultimately reach the Supreme Court.
Earlier this year, the Court ruled presidents can generally remove independent agency members, but it also confirmed Federal Reserve governors may only be dismissed “for cause.” Democrats argue Trump’s case fails to meet that standard.
Sen. Elizabeth Warren (D-MA) called the firing “an authoritarian power grab,” while House Minority Leader Hakeem Jeffries (D-NY) said Trump was targeting Cook, the first Black woman on the Fed board, without evidence of wrongdoing.
The dispute comes as Trump pushes for lower interest rates. Adriana Kugler’s recent resignation already gave Trump one Fed appointment, and Cook’s potential removal would give him another seat on the 12-member board.
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