Trump fires Fed Governor Lisa Cook amid mortgage fraud probe

US President Donald Trump announced that he has dismissed Federal Reserve Board member Lisa Cook, intensifying his pressure on the central bank to lower interest rates.

In a letter addressed to Cook and shared on social media, Trump cited a Justice Department investigation into whether Cook had made false statements on mortgage applications. He argued that this inquiry provided “sufficient cause” to remove her from the Fed board.

Cook, nominated by President Joe Biden and confirmed by the Senate in 2022, is a former professor of economics and international relations at Michigan State University and a former director at the Chicago Fed.

Trump wrote, “The American people must have complete confidence in the integrity of those entrusted with shaping policy and overseeing the Federal Reserve. In light of your deceptive and potentially criminal conduct on a financial matter, neither the public nor I can maintain trust in your integrity.”

This move follows Trump’s repeated attempts to influence the Fed to cut interest rates. He has previously suggested removing Fed Chair Jerome Powell.

The allegations stem from a complaint filed with the Justice Department by Federal Housing Finance Agency Director Bill Pulte, who claimed that Cook had listed two homes as her primary residence. Pulte has launched several mortgage fraud investigations targeting political figures, including New York Attorney General Letitia James and California Senator Adam Schiff.

Pulte praised Trump’s decision on social media, writing, “Thank you President Trump for your commitment to stopping mortgage fraud and enforcing the law. If you commit mortgage fraud in America, no matter who you are, we will come after you.”

Cook rejected Trump’s justification, insisting that he lacked the authority to remove her. “President Trump claimed he fired me ‘for cause’ without any legal basis. I will not resign. I will continue fulfilling my responsibilities to support the American economy as I have since 2022,” she told POLITICO.

Her attorney, Abbe Lowell, denounced Trump’s action as unlawful: “Once again, President Trump turned to social media to carry out a ‘tweet firing.’ His demands lack due process, legal authority, or legitimacy. We will take all necessary steps to block this illegal act.”

The mortgage fraud allegations have not yet led to criminal charges or findings of misconduct.

In his letter, Trump defended his legal authority: “The executive power of the United States is vested in me as president. It is my solemn duty to ensure the faithful execution of the laws, and for that reason I have determined that your immediate removal is necessary.”

Wyoming Senator Cynthia Lummis backed Trump, declaring that his action signaled “the end of Federal Reserve Board members behaving as if they are above the law.”

However, the decision drew sharp criticism across party lines. Former Treasury Secretary Larry Summers called it “a troubling politicization of the Federal Reserve,” arguing that Cook was denied an opportunity to defend herself in an independent review and that no convincing evidence was presented to justify her removal.

Senator Elizabeth Warren, a senior member of the Senate Banking Committee, urged courts to overturn Trump’s move: “The attempt to oust Lisa Cook is the desperate scapegoating of a president who has failed to lower costs for Americans. It is an authoritarian power grab that blatantly violates the Federal Reserve Act and must be struck down in court.”