WASHINGTON, United States — President Donald Trump has renewed his effort to remove Federal Reserve Governor Lisa Cook, giving her three weeks to respond to mortgage fraud allegations that her lawyer has called baseless. The move comes after the U.S. Supreme Court blocked Trump’s earlier attempt to fire Cook in June, keeping the dispute over presidential authority and Federal Reserve independence alive.
- The White House says Trump is considering removing Lisa Cook from the Federal Reserve.
- Cook has been given three weeks to respond to the allegations outlined in a White House letter.
- Her lawyer Abbe D. Lowell says there is no valid cause for her removal.
- The Supreme Court blocked Trump’s earlier attempt to remove Cook in a 5-4 ruling in June.
White House revives effort against Cook
A letter signed by White House Deputy Chief of Staff Dan Scavino said Trump was considering removing Cook from her position and asked her to respond to allegations concerning mortgage transactions.
The letter, first reported by ABC News and seen by Reuters, alleged that Cook had committed conduct that could amount to crimes carrying penalties of up to 30 years in prison. It also questioned whether the alleged conduct affected her suitability to serve as a Federal Reserve governor.
Cook’s attorney rejected the accusations. In a statement, Abbe D. Lowell said there was no valid basis for removing his client and indicated that the legal challenge would continue.
There is no valid cause for removing Cook from her position.
Lowell said the latest effort would be challenged and that Cook’s position and the Federal Reserve’s institutional role would be defended.
Supreme Court ruling remains central to dispute
The latest move follows a 5-4 Supreme Court decision in June that prevented Trump from removing Cook at that stage. The ruling focused on the procedures used to pursue her dismissal rather than resolving whether the underlying allegations were true.
Chief Justice John Roberts, writing for the court, said Cook had not been given the procedural protections required by law to contest the allegations before the attempted removal.
The Supreme Court subsequently returned the dispute to lower courts. Roberts also indicated that questions surrounding what happened in the mortgage transactions and whether the conduct met the legal standard for removal remained unresolved.
The ruling nevertheless established an important protection for Federal Reserve officials against being dismissed simply at a president’s discretion. The case is therefore being closely watched for its implications for the central bank’s independence.
Mortgage allegations date back to last year
The allegations now cited by the White House were previously raised by William Pulte, director of the Federal Housing Finance Agency. Last year, Pulte asked the Justice Department to investigate Cook and others over alleged mortgage fraud.
According to the supplied Reuters report, there has been no indication that a criminal investigation resulting from that referral has moved forward.
Reuters previously reported that Cook identified one of the properties involved as a vacation home in documents submitted to a lender. The news agency also reported that Michigan’s local tax authority found that Cook had not violated rules governing tax benefits on another property she had identified as her primary residence.
Earlier court proceedings challenged Trump’s approach
U.S. District Judge Jia Cobb ruled in September that Trump’s earlier attempt to remove Cook without notice or a hearing likely violated her due-process rights under the Fifth Amendment.
Cobb also found that the allegations likely did not meet the legal requirements for removing a Federal Reserve governor because they concerned conduct that occurred before Cook joined the board.
The Supreme Court did not adopt that particular interpretation of the removal standard. Instead, its ruling emphasized that any attempt to remove Cook would have to satisfy the applicable procedural protections and meet a substantial threshold.
Trump’s broader dispute with the Federal Reserve
Trump’s conflict with the Federal Reserve has extended beyond Cook. During his previous effort to remove her, he had also repeatedly criticized then-Fed Chair Jerome Powell and threatened to dismiss him over the central bank’s interest-rate decisions.
Kevin Warsh, Trump’s chosen successor to Powell, took over as Fed chair in May. Trump has since directed criticism toward other members of the Federal Reserve board, most of whom were appointed by former President Joe Biden.
Trump has said he will not criticize Warsh, even though the central bank has not yet delivered the rate reductions the president has sought.
Legal dispute could take months
Peter Conti-Brown, a professor at the University of Pennsylvania’s Wharton School, told Reuters that the Supreme Court’s procedural ruling left room for the administration to pursue the matter again.
Conti-Brown characterized the allegations as a pretext for targeting Cook and predicted that she would ultimately prevail because the accusations remain unproven. He estimated that the dispute could take about a year to resolve, similar to the earlier proceedings.
The Federal Reserve and the White House did not comment on the latest development, according to the supplied Reuters report.
What happens next
Cook now has three weeks to respond to the allegations contained in the White House letter. Any further attempt to remove her will be considered against the legal protections and standards outlined during the earlier court proceedings.
The dispute could ultimately determine how far a U.S. president can go in seeking to remove a Federal Reserve governor while preserving the statutory protections intended to shield the central bank from direct political control.
Legal disclaimer: This article reports on an ongoing legal and governmental dispute based on the supplied Reuters report. It does not constitute legal advice or determine whether any allegation against Lisa Cook is legally or factually established.
