Federal Reserve governor Lisa Cook says the Trump administration has no legal basis to remove her from the central bank’s governing board
ByCHRISTOPHER RUGABER AP economics writer
WASHINGTON — Federal Reserve governor Lisa Cook said the Trump administration has no legal basis to remove her from the central bank’s governing board in a letter late Wednesday responding to renewed threats from the White House.
Trump first sought to fire Cook a year ago over allegations that she commited mortgage fraud, which she denies. The charge has not been proven or considered in court. The Supreme Court ruled that Cook could remain in her position while the case is litigated. The justices also said Trump could try to fire her again if he provided proper notice and a chance to contest it.
A White House aide earlier this month had given Cook until Wednesday to respond.
“For the second time in a year, we have explained why there is no legal basis for President Trump to remove Governor Cook for cause,” her attorneys, Abbe Lowell and Norman Eisen, said in a statement. “An inadvertent error is not fraud, as the President and a third of his cabinet should know because they reportedly did the same thing. These attacks on Governor Cook are not about real estate paperwork; they are an attempt by President Trump to force the Federal Reserve to bend to his will.”
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Officials in the Trump administration have accused Cook of declaring two homes as “primary residences” in mortgage applications. Primary residences can sometimes receive lower mortgage rates or down payments than second homes.
Cook on Wednesday said she had referred to one of those two homes in some documents as a “vacation home” and had not sought to deceive lenders. She said any errors were unintentional and did not rise to a level that justified her firing.
If Trump is able to remove Cook, he could name a replacement and his appointees would gain a majority on the Fed’s board. Trump has long attacked the Fed for not cutting its benchmark interest rate quickly enough.
