Hours after getting fired by US President Donald Trump, Federal Reserve Governor Lisa Cook said that the President has no authority to fire her from the central bank, and she will not resign.
Cook's remarks come after receiving a letter by Trump earlier saying he was removing her from the Fed effective immediately.
"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. "I will not resign. I will continue to carry out my duties to help the American economy as I have been doing since 2022."
Trump cited accusations made last week by Bill Pulte, his appointee to the housing finance regulator, who claimed that Cook improperly listed two primary residences in 2021 to secure lower mortgage rates. Cook has retained prominent attorney Abbe Lowell, who said Trump’s “reflex to bully is flawed and his demands lack any proper process, basis or legal authority.”
The unprecedented move is expected to trigger a legal battle that could go up to the Supreme Court. Legal experts noted that Fed governors, unlike cabinet officials, cannot be removed at will by the president. They serve 14-year terms and can only be dismissed “for cause,” usually for misconduct in office, a process that requires due proceedings.
Cook, appointed by President Joe Biden in 2022 as the first Black woman governor of the Fed, was narrowly confirmed in the Senate with Vice President Kamala Harris breaking a 50-50 tie.
Trump’s decision has raised concerns over the independence of the US central bank, long considered vital for its ability to take politically unpopular decisions such as raising interest rates to curb inflation. Markets reacted with caution on Monday night, with stock futures and the dollar slipping slightly.
Senator Elizabeth Warren called the attempt illegal and “an authoritarian power grab that blatantly violates the Federal Reserve Act.”
If successful, the move would give Trump’s appointees a majority on the Fed board, potentially shifting monetary policy in favor of lower borrowing costs.
(With inputs from AP)
Cook's remarks come after receiving a letter by Trump earlier saying he was removing her from the Fed effective immediately.
"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. "I will not resign. I will continue to carry out my duties to help the American economy as I have been doing since 2022."
Trump cited accusations made last week by Bill Pulte, his appointee to the housing finance regulator, who claimed that Cook improperly listed two primary residences in 2021 to secure lower mortgage rates. Cook has retained prominent attorney Abbe Lowell, who said Trump’s “reflex to bully is flawed and his demands lack any proper process, basis or legal authority.”
The unprecedented move is expected to trigger a legal battle that could go up to the Supreme Court. Legal experts noted that Fed governors, unlike cabinet officials, cannot be removed at will by the president. They serve 14-year terms and can only be dismissed “for cause,” usually for misconduct in office, a process that requires due proceedings.
Cook, appointed by President Joe Biden in 2022 as the first Black woman governor of the Fed, was narrowly confirmed in the Senate with Vice President Kamala Harris breaking a 50-50 tie.
Trump’s decision has raised concerns over the independence of the US central bank, long considered vital for its ability to take politically unpopular decisions such as raising interest rates to curb inflation. Markets reacted with caution on Monday night, with stock futures and the dollar slipping slightly.
Senator Elizabeth Warren called the attempt illegal and “an authoritarian power grab that blatantly violates the Federal Reserve Act.”
If successful, the move would give Trump’s appointees a majority on the Fed board, potentially shifting monetary policy in favor of lower borrowing costs.
(With inputs from AP)
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Trump vs Federal Reserve: US President 'fires' Fed governor Lisa Cook over mortgage fraud claims
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