Trump fires Fed Governor Lisa Cook
WASHINGTON (AP) — In an unexpected move late Monday, President Donald Trump fired Federal Reserve Governor Lisa Cook, escalating his ongoing efforts to assert greater control over the central bank—an institution traditionally insulated from political interference.
Trump announced Cook’s dismissal in a letter posted on his Truth Social platform, citing allegations of mortgage fraud. The accusations stem from claims made by Bill Pulte, a Trump appointee to the agency overseeing mortgage lenders Fannie Mae and Freddie Mac. Pulte alleged that in 2021, Cook improperly claimed two properties—one in Ann Arbor, Michigan, and another in Atlanta—as primary residences to secure more favorable mortgage rates, which are typically higher for second homes or investment properties.
The firing comes just days after Cook publicly stated she had no intention of stepping down, despite Trump’s prior calls for her resignation. Senate Democrats had voiced strong support for Cook in the face of political pressure.
“The Federal Reserve plays a critical role in setting interest rates and overseeing member banks. The public must have absolute confidence in the integrity of those entrusted with this responsibility,” Trump wrote in his letter to Cook. “Given your deceitful and potentially criminal financial conduct, I no longer have that confidence.”
Trump defended the legality of the dismissal, asserting presidential authority under the Constitution. “As President, I am charged with ensuring that the laws of the United States are faithfully executed. I have concluded that your immediate removal is necessary to fulfill that duty,” he stated.
The move is expected to prompt a legal challenge. Cook may remain on the Fed board while the matter is litigated, but she would need to pursue the case personally, as the Federal Reserve is unlikely to represent her.
The incident marks the latest attempt by Trump to influence one of Washington’s last remaining independent institutions. He has long criticized Fed Chair Jerome Powell for not cutting interest rates more aggressively and previously floated the idea of removing him.
Cook’s removal opens the door for Trump to nominate a replacement aligned with his economic agenda. He has said he would only appoint officials who support lowering interest rates.
Last week, Powell signaled the Fed could cut rates soon, though inflation concerns remain. Trump will also have the opportunity to replace Powell when his term ends in May 2026. However, rate decisions are made collectively by 12 voting members on the Fed’s Federal Open Market Committee, so a new chair alone may not be enough to shift the institution’s policy direction.
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