WASHINGTON: US President Donald Trump has dismissed Federal Reserve Governor Lisa Cook, accusing her of mortgage fraud in a move that could trigger a fierce legal battle over the independence of the central bank.
In a letter posted on Truth Social late Monday, Trump said, “In light of your deceitful and potentially criminal conduct in a financial matter, Americans cannot — and I do not — have such confidence in your integrity. I have determined that there is sufficient cause to remove you from your position.”
Cook, whose 14-year term was set to run until 2038, is legally entitled under the Federal Reserve Act to removal only “for cause,” such as proven misconduct. Analysts say the case will likely end up in court, with Cook possibly continuing to serve while litigation proceeds.
Fed Independence at Stake
The firing comes amid Trump’s escalating pressure on the Fed to deliver steep interest rate cuts, a demand the central bank has resisted. With Cook’s ouster and a recent resignation by Governor Adriana Kugler, Trump now has two board seats to fill. He has already nominated Stephen Miran, chair of the White House Council of Economic Advisers, to replace Kugler, pending Senate confirmation.
Critics argue the move is part of Trump’s effort to install loyalists within the Fed, potentially undermining its credibility at a time when its independence is crucial to managing inflation and financial stability.
