Trump Loses Legal Fight to Remove Fed Official Lisa Cook
Trump had announced Cook’s dismissal late last month after she was accused of misrepresenting two properties in Michigan and Georgia.
Quick overview
- The U.S. Court of Appeals rejected President Trump's request to dismiss Federal Reserve Governor Lisa Cook, allowing her to participate in the upcoming FOMC meeting.
- The court ruled that the government's allegations against Cook did not meet the legal threshold for removal and may have violated her due process rights.
- This legal setback highlights Trump's ongoing conflict with the Federal Reserve over interest rate policies.
- Despite having allies on the Fed Board, the final decision on interest rates will be made by the FOMC's 12 voting members.
The Trump administration suffered another legal setback in its clash with the Federal Reserve. The U.S. Court of Appeals for the District of Columbia rejected President Donald Trump’s request to immediately dismiss Federal Reserve Governor Lisa Cook, ensuring she will participate in this Wednesday’s Federal Open Market Committee (FOMC) meeting on monetary policy.
“Given these unique circumstances and the strong likelihood that Cook will prevail, at least on her due process claim, the government’s request for relief is rightly denied,” wrote Circuit Judge Brad Garcia in the ruling. The decision was backed by two of the three judges on the panel, with Trump-appointed Judge Gregory Katsas dissenting, according to The Hill.
Mortgage Fraud Allegations
Trump had announced Cook’s dismissal late last month after she was accused of misrepresenting two properties in Michigan and Georgia as primary residences just weeks apart in 2021, and improperly classifying a third property as a “second home.”
Last week, a federal judge had already issued a temporary order blocking the dismissal, ruling that the administration’s allegations did not meet the legal threshold for removal under the Federal Reserve Act. The court also found that the way the firing was carried out may have violated Cook’s constitutional due process rights.
A Power Struggle with the Fed
The dispute underscores Trump’s ongoing battle with the Fed, which he has repeatedly criticized for not cutting interest rates fast enough to stimulate the economy. With this decision, Cook will cast her vote in the upcoming FOMC meeting on interest-rate cuts.
Trump already has two close allies on the Fed Board—Governors Michelle Bowman and Christopher Waller, both appointed during his first term. He also recently installed Stephen Miran, a former chair of the White House Council of Economic Advisers, to temporarily fill a vacant seat through January.
Still, the FOMC’s decision ultimately rests with its 12 voting members: the Board of Governors, the president of the New York Fed, and a rotating group of regional Fed presidents.
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