The Trump administration is ratcheting up pressure on the Federal Reserve to remove governor Lisa Cook, after the economist declared she had “no intention of being bullied” into stepping down.
Cook, who was appointed to the US central bank’s powerful board of governors by Joe Biden, has been accused by Donald Trump’s officials of committing mortgage fraud. The allegations are unconfirmed.
The US president has waged an extraordinary war on the Fed’s independence, breaking with precedent to demand interest rate cuts and urge its chair, Jerome Powell, to resign. Trump promptly called on Cook to quit on Wednesday.
The Department of Justice is reported to have indicated it is investigating the allegations, with a top Trump official telling Powell the case “requires further examination” – and calling on him to remove Cook from the Fed’s board.
“At this time, I encourage you to remove Ms Cook from your Board,” Ed Martin, the official, wrote in a letter, according to Bloomberg News. “Do it today before it is too late! After all, no American thinks it is appropriate that she serve during this time with a cloud hanging over her.”
The Fed declined to comment. The justice department declined to comment.
Despite Martin’s demand, the Fed chair has no authority under the Federal Reserve Act to remove another member of the board of governors. On Wednesday, the Wall Street Journal reported that Trump had discussed how to fire Cook for cause, citing an unnamed administration official.
The White House did not respond to a request for comment on the report.
On Wednesday morning, Bill Pulte, head of the US Federal Housing Finance Agency, who has become – beyond the president himself – one of the Trump administration’s most vocal critics of Powell and the Fed, published allegations against Cook.
In June 2021, Cook entered into a 15-year mortgage agreement on a property in Ann Arbor, Michigan, and declared her intention to use it as her principal residence, according to Pulte. In July 2021, Cook bought a property in Atlanta, Georgia, and also committed to use that property as her primary residence when taking out a 30-year mortgage, according to Pulte.
In a statement, Cook said: “I do intend to take any questions about my financial history seriously as a member of the Federal Reserve and so I am gathering the accurate information to answer any legitimate questions and provide the facts.”
She is the latest figure to be targeted by Trump officials over claims of mortgage fraud. Pulte has made similar allegations about the New York attorney general, Letitia James, and the California senator Adam Schiff, both Democrats. The justice department is reportedly investigating.
James has dismissed the claims as “baseless”, while Schiff has vehemently denied the allegations, and accused the administration of weaponizing the US justice system.