Trump Defiant As Fed Governor Lisa Cook Threatens Legal Action Over His Attempts To Remove Her From Board

(MENAFN- Live Mint) US President Donald Trump on Tuesday responded to questions about Federal Reserve Governor Lisa Cook 's attorney saying they will file a lawsuit challenging his attempt to remove her.

Asked at a Cabinet meeting if he was prepared for a legal fight, Trump said,“Oh sure, always.”

Cook's attorney, Abbe Lowell, issued a statement saying,“Trump has no authority to remove Federal Reserve Governor Lisa Cook. His attempt to fire her, based solely on a referral letter, lacks any factual or legal basis. We will be filing a lawsuit challenging this illegal action.”

Trump announced Monday night that he was removing Cook from the Fed board over unproven allegations of mortgage fraud. Speaking Tuesday, he said,“We need people that are 100% above board and it doesn't seem like she was.”

Fed defends independence and process

The Federal Reserve issued a statement reaffirming its independence: "Lisa Cook has indicated through her personal attorney that she will promptly challenge this action in court and seek a judicial decision that would confirm her ability to continue to fulfill her responsibilities as a Senate-confirmed member of the Board of Governors of the Federal Reserve System."

The central bank added,“Congress, through the Federal Reserve Act, directs that governors serve in long, fixed terms and may be removed by the president only 'for cause,'” the central bank said.“Long tenures and removal protections for governors serve as a vital safeguard, ensuring that monetary policy decisions are based on data, economic analysis, and the long-term interests of the American people.”

Cook refuses to step down

Cook stated Monday night,“President Trump purported to fire me 'for cause' when no cause exists under the law, and he has no authority to do so. I will not resign.”

Implications for Fed Board majority

Trump, a Republican, has previously pushed Fed Chair Jerome Powell to cut interest rates . If his nominee Steven Miran replaces Governor Adriana Kugler and Trump succeeds in removing Cook, he would gain a 4-3 majority on the Fed's board. Trump commented Tuesday,“We'll have a majority very shortly.”

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