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WASHINGTON — Federal Reserve Governor Lisa Cook has filed a lawsuit against President Donald Trump, challenging what she calls an “unprecedented and illegal” attempt to remove her from office over unproven mortgage fraud allegations.
The legal action, filed on August 28, comes days after Trump issued a letter stating his intent to dismiss Cook, citing concerns that she may have made false statements on mortgage applications prior to her Senate confirmation. Cook’s attorneys argue that the allegations—raised by Federal Housing Finance Agency Director Bill Pulte—are unsubstantiated and do not meet the legal threshold for removal under the Federal Reserve Act.
Cook, the first Black woman to serve on the Fed’s Board of Governors, is seeking a court declaration that her dismissal is unlawful and that she remains an active member of the board. Her lawsuit also names the Federal Reserve Board and Chair Jerome Powell, asserting they are obligated to reject any removal order that lacks proper legal basis.
“The President’s actions violate Governor Cook’s Fifth Amendment due process rights and her statutory right to notice and a hearing,” the complaint states.
Legal experts note that Fed governors can only be removed “for cause,” typically defined as inefficiency, neglect of duty, or malfeasance in office. Cook has not been charged with any crime, and her lawyers argue that the allegations—centered on claims she misrepresented her primary residence on mortgage documents—do not constitute grounds for dismissal.
The case could have far-reaching implications for the independence of the Federal Reserve, which plays a critical role in setting U.S. monetary policy. A ruling is expected to clarify the limits of presidential authority over members of the central bank.
You can read more from NBC News.
