Trump Fires Fed Governor Lisa Cook Amid Legal Battle Over Allegations

WASHINGTON, D.C. — President Donald Trump announced on Monday night that he is firing Federal Reserve Governor Lisa Cook. This unprecedented decision is based on allegations that she committed mortgage fraud prior to her 2021 appointment, a move that raises significant questions about the president’s authority over the Federal Reserve, which generally operates independently from political interference.

In a letter released via his Truth Social platform, Trump stated that Cook is removed effective immediately. Cook’s attorney, Abbe Lowell, declared that this action lacks legal basis and affirmed that they would pursue legal challenges to block the firing. “President Trump purported to fire me ‘for cause’ when no cause exists under the law, and he has no authority to do so,” Cook stated in an email.

The allegations against Cook stem from claims made by Bill Pulte, a Trump appointee to the Federal Housing Finance Agency. Pulte accused Cook of misrepresenting her primary residences to secure more favorable mortgage terms.

Market analysts quickly reacted to Trump’s move, noting its potential to shake confidence in the Fed and the broader financial markets. Immediately following the announcement, stock futures fell, reflecting growing uncertainties among investors about the future of the Federal Reserve’s leadership.

Cook, who is the first Black woman to serve on the Federal Reserve Board of Governors, has support from political figures who argue that Trump’s actions are unprecedented. House Democratic Leader Hakeem Jeffries criticized the firing as an attempt to undermine the independence of the Federal Reserve, describing it as a “racist, misogynistic, and unlawful attack on the integrity.”

The Federal Reserve, established to ensure monetary policy is insulated from political pressures, may now face a challenging legal battle that could further complicate its operations in maintaining economic stability. Legal experts predict that Cook’s lawsuit could escalate to the Supreme Court, probing the extent of presidential authority over the appointments.

In response to concerns raised by the firing, the Fed issued a statement emphasizing that governors may only be dismissed by the president for cause, indicating that Cook’s long tenure is meant to protect against arbitrary removal.