Federal Reserve Governor Lisa Cook refused to resign after President Trump announced her removal, asserting he has no legal authority to fire her without cause. She plans to sue over the attempt, which was based on a criminal referral alleging mortgage fraud by a third party. Cook maintains her duties to the American economy and challenges the legality of Trump's action, highlighting broader implications for the Federal Reserve's composition and political influence.
Federal Reserve Governor Lisa Cook Declares She Will Not Resign Amid Attempted Removal by Donald Trump
Dr. Lisa DeNell Cook, seen here at a Senate Banking, Housing and Urban Affairs Committee confirmation hearing on Capitol Hill in Washington, D.C. in February of 2022. President Donald Trump announced Monday she was fired, but Cook proclaimed Tuesday she would not resign. File Pool Photo by Ken Cedeno/UPI | License Photo
Background of the Dispute
Aug. 26 (UPI) -- Federal Reserve Governor Lisa Cook has declared that not only won't she resign after President Donald Trump fired her, but will sue him for trying.
"President Trump purported to fire me 'for cause' when no cause exists under the law, and he has no authority to do so," Cook said in a statement Tuesday. "I will not resign."
"I will continue to carry out my duties to help the American economy as I have been doing since 2022," she concluded.
Presidential Attempt to Remove Cook
Trump sent her a letter Monday that stated "Pursuant to my authority under Article II of the Constitution of the United States and the Federal Reserve Act of 1913, as amended, you are hereby removed from your position on the Board of Governors of the Federal Reserve, effective immediately."
Section 10 of the Federal Reserve Act does state a Fed governor can be "removed for cause by the President."
Trump listed a criminal referral the Justice Department received from U.S. Director of Federal Housing Bill Pulte as his cause, which he alleged to have evidence Cook committed mortgage fraud.
Allegations and Legal Response
Pulte, who has made several accusations against Cook over more than a week, posted a statement Monday from the U.S. Federal Housing Department.
"Thank you President Trump for your commitment to stopping mortgage fraud and following the law," Pulte wrote to X. "If you commit mortgage fraud in America, we will come after you, no matter who you are."
However, no charges have been levied against Cook of any sort.
Legal and Political Implications
Cook has since retained the services of attorney Abbe Lowell.
"President Trump has no authority to remove Federal Reserve Governor Lisa Cook," he said in a statement. "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."
Two of the seven current Fed governors are prior Trump appointees, and as now-former Fed Governor Adriana Kugler resigned earlier this month, Trump can appoint someone of his choice to fill her seat. Should Trump succeed in terminating the Biden-appointed Cook or should she resign, he could also replace her with an appointee of his choice, which would shift the board to a majority of governors who share his economic positions.