Lisa Cook dinner, member of the Board of Governors of the US Federal Reserve, attends a Federal Reserve Board open assembly discussing proposed revisions to the board’s supplementary leverage ratio requirements on the Federal Reserve Board constructing in Washington, DC, on June 25, 2025.
Saul Loeb | AFP | Getty Pictures
President Donald Trump on Monday fired Federal Reserve Governor Lisa Cook dinner, in line with a letter on his Fact Social, an unprecedented transfer and a big escalation of his assaults on the U.S. central financial institution.
“Pursuant to my authority underneath Article II of the Structure of america and the Federal Reserve Act of 1913, as amended, you might be hereby eliminated out of your place on the Board of Governors of the Federal Reserve, efficient instantly,” Trump wrote.
CNBC reached out to the Federal Reserve for remark.
Trump’s transfer pushes the Federal Reserve into unchartered territory and can probably result in a authorized conflict that might wind up on the Supreme Court docket.
The Trump administration claims that Cook dinner, who was nominated by former President Joe Biden in 2022, dedicated mortgage fraud by allegedly naming two totally different properties as her major residence on the identical time.
Federal Housing Finance Company Director Invoice Pulte, an outspoken critic of Fed Chairman Jerome Powell, publicly accused Cook dinner of mortgage fraud on Aug. 20 and despatched a felony referral to the Justice Division.
Trump cites the felony referral in his letter and mentioned that “there may be ample cause to consider you will have made false statements on a number of mortgage agreements.”
“For instance, as detailed within the Prison Referral, you signed one doc testifying {that a} property in Michigan can be your major residence for the subsequent yr,” Trump wrote.
“Two weeks later, you signed one other doc for a property in Georgia stating that it might be your major residence for the subsequent yr,” he continued.
Trump claimed that it’s “inconceivable” that Cook dinner was “not conscious of [her] first dedication when making the second.”
After Pulte’s claims began to flow into final week, Trump shortly referred to as for Cook dinner’s resignation, writing in a social media publish that “Cook dinner should resign, now!!!”
Cook dinner mentioned in an announcement the identical day that she has “no intention of being bullied to step down from my place due to some questions raised in a tweet.”
Two days later, Trump mentioned he would fireplace Cook dinner if she didn’t resign.
“What she did was dangerous,” Trump instructed reporters on Aug. 22.
Trump’s firing will probably set off a authorized showdown. The Supreme Court docket might get entangled if a decide permits Cook dinner to proceed serving in her function whereas authorized proceedings play out, the New York Occasions famous.
Congress curbed the president’s authority to unilaterally fireplace a Fed governor within the Federal Reserve Act of 1913, which states that president can solely accomplish that “for trigger.” Whereas the legislation doesn’t elaborate on what constitutes “trigger,” it has traditionally been understood to imply malfeasance or dereliction of responsibility.
If Trump is finally profitable in eradicating Cook dinner, he’ll have the ability to nominate her alternative and reshape the Fed’s governing board for the subsequent a number of years. Fed governors usually serve 14-year phrases. Cook dinner is the primary Black girl to function a governor of the Federal Reserve.
Two of the seven present Fed governors, Christopher Waller and Michelle Bowman, are Trump appointees. Trump nominated Powell to be the Chair of the Federal Reserve in 2017.
One other spot opened up earlier this yr when Adriana Kugler abruptly stepped down, giving Trump one other seat to fill. He has nominated Stephen Miran, chair of the Council of Financial Advisors, to fill the vacant seat.
The transfer exacerbates considerations surrounding the Federal Reserve’s independence underneath the Trump administration.
Trump has repeatedly criticized the central financial institution and its chair for not slicing short-term rates of interest.
Powell has up to now resisted Trump’s stress, even because the president has threatened to fireplace him earlier than his time period as chair expires subsequent yr.
Talking on Aug. 22 on the central financial institution’s annual symposium in Jackson Gap, Wyoming, nevertheless, Powell instructed that circumstances “might warrant” rate of interest cuts because the Fed proceeds “fastidiously.”
That is creating information. Please test again for updates.