Donald Trump is attempting once again to oust the US Federal Reserve governor Lisa Cook over allegations of mortgage fraud, despite a recent US supreme court decision that upheld the central bank’s independence.
Cook reportedly received a letter from the White House this week that provided notice, in accordance to the supreme court’s June ruling, that Trump was “considering removing” her from her Fed position over the same claims of mortgage fraud that he levied against her last summer.
The letter, first reported by ABC News, accused Cook of falling “well short of the standard” required of a sitting Fed governor and requested she provide a written response to the allegations within three weeks.
The supreme court in June ruled 5-4 that Cook was entitled to stay on as Fed governor while she fights the president’s allegations, writing in its majority opinion that Trump “failed to afford Cook the procedural protections to which she was entitled by statute”.
“Without such protections, she could not properly dispute the charges the president laid against her,” the justices said.
In response to the White House’s letter, one of Cook’s lawyers, Abbe D Lowell, called the allegations “as baseless now as they were a year ago when President Trump tried to remove Governor Cook and interfere with the independence of the Federal Reserve”.
“No matter what President Trump tries to do next, this much is clear under the facts and Supreme Court precedent – there is no valid cause for removing Governor Cook,” Lowell said in a statement. “As we did before, we will challenge this latest pretext and preserve her position and the historic role of the Fed.”
The White House did not immediately respond to a request for comment.
Cook was appointed by Joe Biden in 2022 to a 14-year term that will end in 2038. She is the first Black woman to serve as a Fed governor. Before she joined the Fed, she served on Barack Obama’s council of economic advisers and has taught at Harvard University and Stanford University.
Trump first abruptly fired Cook last August in an unprecedented attack on the central bank’s independence. The White House accused her of wrongly designating two separate properties in Georgia and Michigan as her primary residence and failing to report rental income on her Atlanta property for two years. Cook denied the allegations and sued the Trump administration for firing her without cause or proper procedure.
Cook and her legal team have maintained that the claims of mortgage fraud are based on “inadvertent” paperwork errors and that the administration is “cherrypicking” facts.
Cook’s firing and ongoing legal battles also coincided with Trump’s attacks on the Fed for not lowering rates. Cook, along with then Fed chair, Jerome Powell, had backed the central bank’s decision not to lower rates, which drew the ire of the White House. Trump called Powell “too stupid and too political” and launched a justice department investigation into his renovations of the Fed’s headquarters in Washington, which has since been dropped.
The Fed is now under the leadership of Kevin Warsh, a Trump pick who had previously shown favor towards cutting rates. Warsh has maintained that he will make decisions based on economic data, not the will of the president, and has made it his mission to fight the country’s heightened inflation, which typically is addressed by rate hikes.
“We’re an independent central bank,” he said in response to questioning from Democratic House members at a hearing in July. “We’re honored to be independent.”
