President Trump Dismisses Federal Reserve Governor Lisa Cook Amid Mortgage Fraud Allegations

President Donald Trump has announced the immediate removal of Federal Reserve Governor Lisa Cook, citing allegations of mortgage fraud. In a letter posted on Truth Social, Trump stated: "Pursuant to my authority under Article II of the Constitution of the United States and the Federal Reserve Act of 1913, as amended, you are hereby removed from your position on the Board of Governors of the Federal Reserve, effective immediately."

The allegations stem from a criminal referral by Federal Housing Finance Agency Director William Pulte, who accused Cook of falsely designating two properties in Michigan and Georgia as primary residences in 2021 to obtain favorable mortgage terms. Cook has denied any wrongdoing and stated she has "no intention of being bullied to step down from my position because of some questions raised in a tweet."

Legal experts suggest this move tests the limits of presidential power over the traditionally independent Federal Reserve, as the Federal Reserve Act permits the removal of a governor "for cause," a provision that has never been tested in court. Critics, including Senator Elizabeth Warren, labeled the move an illegal power grab aimed at gaining greater influence over Fed policy.

Financial markets reacted to the announcement, with the U.S. Dollar Index declining by 0.3% to 98.187, and bond markets experiencing shifts in Treasury yields. Cook, appointed by President Joe Biden in 2022 as the first Black woman to serve on the Fed's board, has a term running until 2038. Her removal could provide Trump with an opportunity to further influence the central bank's composition and policies.