Lisa Cook Sues Trump Over Removal Attempt
Federal Reserve member Lisa Cook has taken legal action against President Trump, accusing him of an “unprecedented, illegal attempt” to oust her from her role.
In her lawsuit, she is asking the judge to prevent her removal, stating that it’s essential to protect the independence that Congress has mandated, allowing both her and the Federal Reserve to “continue its important work.”
Cook argues that the operational independence of the Federal Reserve is crucial for navigating political pressures, especially during election cycles, to make sound economic decisions.
Interestingly, the lawsuit also names Federal Reserve Chair Jerome Powell and the Governor’s Committee as defendants.
According to the Federal Reserve Act, the President can only dismiss board members “for cause.” However, the court has never clearly defined what constitutes this “cause,” as no other president has attempted to remove a federal governor until now.
In a letter he shared on Monday, Trump claimed he removed Cook due to “cause,” referring to a criminal referral from the Federal Housing Finance Agency (FHFA). This referral suggested she may have provided false information concerning various mortgage agreements.
The letter alleges that Cook improperly identified two properties in Michigan and Georgia as her “major residences.”
Trump emphasized that the American public needs to trust in the integrity of those who set policies and oversee the Federal Reserve. He expressed that her alleged deceitful and possibly criminal financial dealings have shaken that trust.
In response to Trump’s allegations, Cook contends that they do not fulfill the legal criteria necessary to justify her removal.
She believes that Trump’s actions contradict the Federal Reserve Act, which clearly mandates that a valid cause must be presented for any such removal.
The Federal Reserve has chosen not to comment on the matter, while both the White House and Cook’s legal team have been asked for their input.
Updated at 10:05am
