Bill Ackman Says Fed's Lisa Cook 'Just Needs To Answer A Simple Question' To Disprove Trump's Fraud Allegations

The controversy around President Donald Trump's move to fire Federal Reserve Board member and Governor Lisa Cook refuses to die down, and Pershing Square Capital founder Bill Ackman became the latest voice on the Street to air his opinion.

“Governor Cook should immediately put forth the facts to clear her name, or she should resign in the best interests of the integrity of our financial system,” said Ackman in his late Wednesday post on X. The hedge fund manager is known for his pro-Trump stance and backed him in the November 2024 presidential race.

Ackman viewed that whether Cook has committed mortgage fraud or not is not a“political question” but a“question of fact.”“Whether President @realDonaldTrump has the technical legal authority to terminate Gov Cook is not that relevant in my view,” he said.

The market largely shrugged off the move to oust Cook despite a certain section of analysts and political watchers crying foul over it.

The SPDR S & P 500 ETF (SPY), an exchange-traded fund (ETF) that tracks the S & P 500 Index, and the Invesco QQQ Trust (QQQ) have added 11% and 12.5%, respectively, this year despite the geopolitical and macroeconomic headwinds.

While the sentiment toward the SPY ETF stayed 'bullish' (60/100) by late Wednesday, that toward the QQQ ETF remained 'bearish.' The message volumes on both streams were at 'normal' levels.

Ackman pointed out that there are precedents.“There is a long history of Fed Governors who had relatively minor ethical or legal infractions who resigned in light of the importance of unimpeachable probity for those who serve in this important position,” he said.

He opined that“It should be straightforward for Governor Cook to disprove the alleged fraud, and it shouldn't require a team of lawyers and litigation to do so.”

“She just needs to answer a simple question: Did she or didn't she sign an affidavit declaring that the subject properties were her primary residences? Yes or no.”

The controversy was sparked by Federal Housing Finance Agency Chief Bill Pulte, who made a criminal referral concerning Cook to the U.S. Attorney General, Pamela Bondi, alleging that the Fed official misrepresented her primary residence status on one or more mortgage applications to obtain favorable terms. 

“The evidence put forth publicly by @pulte strongly suggests that she lied on one or more mortgage applications, in other words, mortgage fraud,” Ackman said.

Meanwhile, noted economist Paul Krugman said in a Substack post on Tuesday that the“mortgage fraud” accusation wouldn't meet the standard for immediate dismissal from the Fed. He saw the move as one that could help Trump replace independent Fed officials with his“lackeys” who can take his orders.

Fellow economist Peter Schiff echoed similar views.“Firing Lisa Cook has nothing to do with mortgage fraud.”

“Trump went looking for dirt, and this is what he dug up. Trump wants to stack the Fed, so he found a pretense to replace a member who he believes stands in his way.”

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