Donald Trump has doubled down on his extraordinary bid to fire a Federal Reserve governor over an unproven allegation, while Commerce Secretary Howard Lutnick suggested she was a “crook” despite admitting he didn’t know the facts of the case.
But Reserve Bank Governor Lisa Cook announced on Tuesday that she would file a lawsuit challenging the move, saying through her lawyer that the president was acting illegally and had no authority to remove her.
In his latest attack against the Central Bank, Trump took the unprecedented step this week of writing a termination letter to Cook, which he posted on social media, telling her she would be removed from her position “effective immediately.”
The move came after MAGA acolyte Bill Pulte, the head of the Federal Housing Finance Agency, accused Cook of mortgage fraud and referred her to the Justice Department for investigation.
Cook, who was confirmed by the Senate in 2022 as the first Black woman to serve as a Fed governor until 2038, has not been charged with any crime.
Despite this, Trump on Tuesday insisted she had made an “infraction” and boasted that he already had someone else in mind who could replace her on the board of the central bank.
“We’ll have a majority very shortly and that’ll be great,” he said, referencing his desire to control the direction of the independent bank’s monetary policy.
Lutnick, meanwhile, was even more disparaging when asked about the matter on CNBC.
“It’s alleged that she’s committed mortgage fraud, and she says ‘I’m not going anywhere’ - well, the crook always says I’m not going anywhere,” the Commerce Secretary told Squawk Box. “
“Why would anyone defend that? The real question should be: did she commit mortgage fraud, yes or no?”
The push to now unseat Cook comes as Trump seeks to overhaul the Fed and install governors who are more likely to cut interest rates, which he believes will boost the U.S. economy.
The issue has angered the president for months, fueling his calls for Chair Jerome Powell to also resign.
But Trump’s actions are the first time that any president has tried to fire a Fed governor, who can only be removed from their job “for cause” or for some wrongdoing.
According to Pulte, Cook took out a mortgage on a house in Michigan, which was represented to be her principal residence, but soon after took out a loan on a condominium in Atlanta that was also described as her principal residence.
He claims that Cook later listed the Atlanta dwelling for rent but didn’t report any rental income on her ethics filings.
Pulte’s referral comes after a similar DOJ investigation was opened in May into allegations that the MAGA acolyte made against New York attorney general Letitia James, who he claimed had committed fraud by lying on loan and bank documents to obtain better mortgage rates.
At the time, James’s attorney, Abbe Lowell, slammed the investigation as an act of “improper political retaliation … publicly instigated and endorsed by President Trump.”
Asked on Tuesday if he was weaponizing the Justice Department to target people for mortgage fraud, Trump replied “no,” before criticizing the journalist who asked the question.
However, Lowell, who is now also representing Cook, said in a statement on Tuesday: “President Trump has no authority to remove Federal Reserve Governor Lisa Cook. 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.”
