President Trump has issued a new warning to Federal Reserve Governor Lisa Cook about plans to remove her from the central bank’s governing board, citing allegations of mortgage fraud that remain unverified. Previously, the Supreme Court halted an attempt to dismiss Cook.
The warning, delivered in a letter from Deputy White House Chief of Staff Daniel Scavino, demands Cook’s response to accusations claiming false statements on mortgage applications. This charge originated from Trump ally William Pulte, associated with mortgage entities Fannie Mae and Freddie Mac.
“Even if your conduct does not rise to the level of felony offense, it appears to demonstrate a level of gross negligence in financial transactions that calls into question your competence and trustworthiness as a financial regulator,” Scavino stated.
Cook has consistently denied these allegations. Her lawyer, Abbe Lowell, declared in a statement, “These allegations are as baseless now as they were a year ago when President Trump tried to remove Governor Cook and interfere with the independence of the Federal Reserve. There is no valid cause for removing Governor Cook. As we did before, we will challenge this latest pretext and preserve her position and the historic role of the Fed.”
This development was initially reported by ABC News, following Trump’s previous attempt to remove Cook during a period of criticism against the central bank’s monetary policies. Trump also threatened Jerome Powell, then chairman of the Fed. Powell’s term as chair concluded in May, but he remains on the board.
The Supreme Court ruled in June, with a 5 to 4 decision, acknowledging the Federal Reserve’s distinct position within the U.S. government. This ruling established that presidents may only remove Fed governors with legitimate cause. Determination of whether the allegations against Cook fulfill this requirement will now fall to lower courts.
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