The Fed made its first official statement after President Donald Trump dismissed Fed Board Member Lisa Cook, indicating that the matter would be taken to court.
A Fed spokesperson made the following statement in a written statement:
Under the Federal Reserve Act, Congress clearly provides that members of the Federal Reserve Board of Governors serve long, fixed terms and can only be removed by the President for ‘good cause.’ Board members’ long terms and protections from dismissal are critical safeguards that ensure monetary policy decisions are based on data, economic analysis, and the long-term interests of the American people.
The Fed will continue to fulfill its duties in accordance with the law. Governor Cook, through his personal attorney, stated that he will immediately file a lawsuit against this action. As always, the Fed will comply with court orders.
Cook’s dismissal stemmed from a criminal investigation launched by the Justice Department last week.
Federal Housing Finance Agency Director Bill Pulte accused Cook of making false statements on mortgage applications. According to Pulte, Cook attempted to obtain lower interest rates and favorable loan terms by declaring on documents he signed for properties in Michigan and Georgia that each was his primary residence. The documents in question were allegedly signed before Cook took office at the Fed.
Trump cited these allegations in a letter to Cook on Monday night, announcing his decision to dismiss him.
Cook, in a statement the same day, said, “President Trump claims he removed me from office for ‘good cause,’ even though there is no legal reason to do so. He has no such authority.”
“I will not resign. I will continue to do my duty to help the American economy, as I have since 2022.”
*This is not investment advice.
