Trump wants to ‘fire’ Federal Reserve governor

2025-09-01 02:28:49

(MENAFN) Former U.S. President Donald Trump has initiated efforts to remove Federal Reserve Governor Lisa Cook, prompting a legal challenge from her team, which argues that he lacks the legal authority to do so.

In a letter posted Monday on Trump’s Truth Social platform, he claimed to have “sufficient cause” to dismiss Cook, citing allegations that she falsified mortgage documents to obtain more favorable loan terms. The accusations originate from Federal Housing Finance Agency Director Bill Pulte, a Trump appointee, who alleged that Cook misrepresented two properties—one in Michigan and one in Georgia—as her primary residence to benefit from lower mortgage rates.

Trump claimed that the alleged misconduct undermines Cook’s credibility and disqualifies her from continuing as a financial regulator. He referenced a clause in the Federal Reserve’s founding legislation that allows a president to remove a governor “for cause.”

Cook, appointed to the Federal Reserve Board in 2022 by President Joe Biden for a term set to last until 2038, rejected Trump’s claim. Through her attorney, she asserted that the firing attempt is baseless and unlawful, stating, “I will not resign.”

The Federal Reserve Act permits the removal of a governor only “for cause,” which is typically interpreted as serious misconduct or failure to perform official duties. Legal analysts have questioned whether Trump’s actions meet that threshold, especially since the allegations involve personal financial matters and have not been adjudicated in court.

Trump has previously clashed with the Federal Reserve over monetary policy, pushing for aggressive interest rate cuts. The Fed has maintained its independence and resisted pressure to lower rates, citing inflation concerns, partly tied to tariffs introduced during Trump’s presidency. Trump has disputed that claim, blaming high interest rates for increasing national debt costs and criticizing Fed Chair Jerome Powell for not acting in line with his economic agenda.

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