Washington: President Donald Trump announced the removal of Federal Reserve Governor Lisa Cook, accusing her of mortgage fraud. He alleged that Cook misrepresented her primary residence on loan documents in 2021, a charge that was referred to the Justice Department by Bill Pulte, chief of the Federal Housing Finance Agency.
Cook strongly rejected the allegations and Trump’s decision. She stated the move was not legally valid and confirmed she would not step down. Cook’s legal team, led by attorney Abbe Lowell, is preparing to challenge the dismissal, calling it an attack on the independence of the Federal Reserve.
Legal experts argue the President may have overstepped his powers. The Federal Reserve Act allows removal of governors only “for cause,” generally linked to misconduct during service, not past personal matters. This creates a legal gray area that could lead to a prolonged court battle.
The dismissal has triggered political and economic debate across the US. Observers warn that interfering with the Fed’s independence could shake market confidence and set a dangerous precedent. The case may eventually reach the Supreme Court, testing the limits of presidential authority over independent institutions.
