Trump Dismisses Member of the Fed Board

U.S. President Donald Trump announced on Monday that he has dismissed Federal Reserve (Fed) Board member Lisa Cook from her position, citing alleged irregularities related to mortgage loans.

Trump wrote in a letter to Cook, which he posted on his Truth Social network on Monday, that there is ‘sufficient reason to believe’ that the governor made false statements.

In 2021, Cook indicated on documents for separate mortgage loans for properties in Michigan and Georgia that both were her primary residence.

Under U.S. law, the president can only dismiss Fed governors for just cause, which increases the likelihood that Trump’s decision could be subject to legal challenges. Trump indicated his intentions a few days earlier, telling reporters, ‘I will fire her if she does not resign.’

The case regarding the statements related to properties in Michigan and Georgia was referenced in a letter from the director of the Federal Housing Finance Agency to Attorney General Pam Bondi, who was asked to investigate. Trump accused Cook in the letter of ‘fraudulent and criminal behavior in financial matters’ and stated that he does not trust her ‘integrity’.

– At the very least, the questionable behavior demonstrates a level of negligence in financial transactions that calls into question your competence and reliability as a financial regulator – he said, asserting that he has the authority to dismiss Cook under the U.S. Constitution and the Federal Reserve Act of 1913.

Cook responded a few hours later in a statement sent to reporters via email through attorney Abbe Lowell, stating that Trump has no legally justified reasons and lacks the authority to dismiss her from the position to which she was appointed by former U.S. President Joe Biden in 2022.

– I will continue to fulfill my duties to help the U.S. economy – Lowell stated, announcing her intention to contest Trump’s decision.

Trump has been pressuring the Federal Reserve for months to lower interest rates, a request that the central bank has not fulfilled as policymakers remain concerned about inflation, partly driven by Trump’s import tariffs.

Previous Trump calls for Fed Chairman Jerome Powell to resign have been unsuccessful.

Cook, an economist, joined the Fed Board of Governors in May 2022. Her term was set to last until January 31, 2038. Prior to her appointment, she was a professor of economics and international relations at Michigan State University.