Trump Escalates fight to Remove Fed Governor Lisa Cook, Appeals to Supreme Court
A legal battle is unfolding over the attempted dismissal of Federal Reserve Governor Lisa Cook by former President Donald Trump. A district judge,Jia Cobb,has temporarily blocked the firing,arguing that trump’s stated justification – allegations of mortgage fraud – doesn’t meet the legal standard for removing a Fed Board member. The Justice Department has subsequently appealed to the Supreme Court, claiming the judge’s intervention constitutes “undue judicial interference” with presidential authority.
Trump initiated the effort to remove Cook last month following accusations from Bill Ablicte, director of the Federal housing Financing Agency, that Cook committed fraud by falsely designating properties in Michigan and Georgia as primary residences to secure more favorable mortgage terms in 2021.
The legal challenge comes as Cook participated in a recent Federal Reserve meeting where the board voted to lower interest rates by 0.25 percentage points. She voted with the majority,while newly appointed Governor Stephen Miran – a Trump economic advisor confirmed just in time for the meeting – dissented,advocating for a larger half-point cut. Trump himself has publicly suggested a three-point cut.
Crucially, the Court of Appeals ruling in favor of blocking the dismissal did not address the mortgage fraud allegations themselves. Recent reports from Reuters have surfaced documents related to Cook’s Georgia mortgage request that appear to contradict the initial claims, suggesting she identified the property as a vacation home to the bank.
While the conservative-leaning Supreme Court has generally sided with Trump in cases involving the removal of federal officials, this case presents a novel legal question with potentially notable economic ramifications.
Cook has asserted that trump’s attempt to remove her is politically motivated. Judge Cobb also noted that Trump’s initial declaration of the dismissal via social media, without providing Cook an chance to respond to the accusations, may have violated her constitutional rights.
Should Trump succeed in removing Cook and replacing her with a more aligned appointee, he would gain a stronger foothold within the Federal Reserve, potentially securing two votes (along with Miran) to advance his economic agenda. While Trump previously considered removing Fed Chair Jerome Powell, he ultimately abandoned that effort due to the difficulty of doing so without evidence of criminal wrongdoing. Powell’s term, originally appointed by Trump, expires in May.
