Fed Governor Lisa Cook Sues Trump, Jerome Powell to Block Firing
“The President’s actions violate Governor Cook’s Fifth Amendment due process rights and her statutory right to notice and a hearing under the FRA.”
Federal Reserve Governor Lisa Cook has sued President Donald Trump and Federal Reserve Chairman Jerome Powell to block her firing.
This case challenges President Trump’s unprecedented and illegal attempt to remove Governor Cook from her position which, if allowed to occur, would the first of its kind in the Board’s history. It would subvert the Federal Reserve Act (“FRA”), which explicitly requires a showing of “cause” for a Governor’s removal, which an unsubstantiated allegation about private mortgage applications submitted by Governor Cook prior to her Senate confirmation is not.
The President’s actions violate Governor Cook’s Fifth Amendment due process rights and her statutory right to notice and a hearing under the FRA. Accordingly, Governor Cook seeks immediate declaratory and injunctive relief to confirm her status as a member of the Board of Governors, safeguard her and the Board’s congressionally mandated independence, and allow Governor Cook and the Federal Reserve to continue its critical work.
OK, Cook has a point.
In America, no one should lose their job or face any consequences over allegations.
If the DOJ has sufficient evidence of mortgage fraud against Cook, then it should indict her.
Trump fired Cook on Tuesday.
Trump cited a criminal referral from August 15, where William J. Pulte, director of the Federal Housing Finance Agency, told Attorney General Pam Bondi he had “sufficient reason to believe” Cook made false statements on one or more mortgage agreements.
“For example, as detailed in the Criminal Referral, you signed one document attesting that a property in Michigan would be your primary residence for the next year,” wrote Trump. “Two weeks later, you signed another document for a property in Georgia stating that it would be your primary residence for the next year.”
Last week, Bondi said the DOJ would look into the allegations, placing U.S. Pardon Attorney Ed Martin in charge of the investigation.
Trump explained that Cook could not stay on the board of governors because “the conduct at issue exhibits the sort of gross negligence in financial transactions that calls into question your competence and trustworthiness as a financial regulator.”
Cook fired back in the lawsuit:
Congressional intent that the “for cause” standard in the FRA requires a finding of “inefficiency, neglect of duty, or malfeasance in office” is illustrated by the fact that Congress amended the FRA three months after the Supreme Court’s decision in Humphrey’s Executor to provide Board members with 14-year terms “unless sooner removed for cause by the President. ”Prior to that, the statute was silent on removal. The Humphrey’s Executor decision was raised in the hearings on the passage of these amendments to the FRA.
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As the Court’s articulation of the standard in Humphrey’s Executor makes clear, removal ‘for cause’ requires some connection to official conduct, prohibiting removal based on an unsubstantiated allegation of private misconduct (which in this case allegedly occurred prior to her Senate confirmation). And even to the extent that private misconduct could bear on a particular.
We need to know if the alleged mortgage fraud came up during her Senate confirmation hearing. I think it could be an essential point.
In all, Trump is reasonable in thinking that anyone who knowingly commits mortgage fraud should not have a place at the table to make monetary decisions that affect anyone.
Cook only faces accusations of mortgage fraud at this time.
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If the President no longer has faith in one of his employees then it’s out the door. I remember when that used to be the accepted norm but apparently only applies to Democrats.
According to Breitbart, a 1935 revamp of the Federal Reserve Act allows the President to fire anyone from the Board for cause. The revamp did not specify what cause had to be, and the point of doing thar was to keep removal beyond the reach of the courts.
Sufficient cause for termination of any high level official covered under Article II is, “I no longer have confidence in your ability to do the job for which you were hired.” That’s it.
Different for civil service, of course, but Ms. Cook is a senior executive and (as the courts have said) covered under Article II. If Mr. Trump wants her out, she’s gone.
I wouldn’t count on that. I’m more than sure the Judge will find some convoluted, twisted interpretation of the FRA whereby Trump is unable to fire any Fed. Reserve Governor no matter the reason or cause for that termination. Or alternatively, will impose an injunction on Cook’s removal until such time that the lawsuit works its way through the court system. Which of course they will end up slow-walking the case and waste as much time (months? years?) until the final decision is made, Guaranteed.
The problem is, the Fed exists in a twilight zone. They’re not strictly an executive agency, only kinda-sorta. So Trump isn’t their boss, only kinda-sorta. The ambiguities are deliberate, and speak to its founders’ desire to avoid accountability.
Which is precisely what makes the Fed’s structure UnConstitutional.
We have precisely 3 branches of government. Not 4.
That’s a good point, especially when the the President is the party who is specifically empowered to remove a board member “for cause” under the Federal Reserve Act, which leaves “cause” undefined. Cook and her lawyers believe they can define and limit the President’s discretion. Even assuming that discretion is only defined by statute, it clearly isn’t their call. It’s the President Trump’s call.
Just because mortgage fraud is rampant within a certain demographic, doesn’t mean we should look the other way, when a steward of our financial system, engages in mortgage fraud. Notice she is not in the least bit remorseful; she could claim it was all a mistake, confusion, not sure where she as going to live, ect…, and she is going to rectify the situation. Instead she is recalcitrant. BTW, she claimed on two mortgage applications, in two states, that both homes were going to be her primary residence, gaining a lower interest rate, rather that paying the higher interest rate on what is a second home or investment property. She likely engaged in insurance fraud too, as insurance rates are higher on second homes/investment homes than that of primary homes.
Firing someone shouldn’t be this difficult. If there is evidence or wrongdoing you’re gone. Layer after layer of protection for the employee but what about the employer? Who’s the boss?
It’s the government’s job to implicate itself in everyone else’s otherwise simple contractual arrangements, through blankets of regulation, and the introduction of sticker-nose “stakeholders” you never knew you had. How much more so among themselves?
she is no doubt trying to rally the troops to create an
insurrection
bring her up on charges and jail her while she awaits
Now Trump should fire Powell for cause. Trump will win this one.
Now Trump can go back and revisit Jerome Powell’s 2.5 billion dollar self-financed renovation of the fed building.
By comparison, AI estimates that to build an exact replica of the white house at today’s prices it would cost a half a billion dollars.
Powell’s makeover of fed building includes lavish unnecessary features such as:
Rooftop garden terraces
VIP dining rooms
VIP elevators
Premium marble through out
Basement art gallery
Ornate water features
Etc, etc, etc
yeah but what about the costs for the 12 different bathrooms to accommodate gender fluidity
I’m of the opinion that every federal facility needs to be basic but code-compliant construction. Steel desks and filing cabinets. Break rooms with a standard fridge and maybe an employee-funded coffee service similar to the “coffee mess” setups we had in the navy. Basic lobby furnishings. The exec level types might get wood desks and book cases, but nothing fancy.
This would save the taxpayer in two ways: lower facility costs, and far fewer people wanting “civil” “service” “jobs”.
And don’t forget that you re-deploy all the federal departments, services, administrations, bureaus, and what not out of D.C. and to places that begin with a “C”. Like Cleveland or Cincinnati , OH or perhaps Casselton, Cavalier, and Cando N. Dakota. or there’s plenty of cities that being with “C” in Louisiana. Remove them all from their place of privilege (D.C.) and plop them all across the nation and see how many of these people really want those jobs. Not many I’d assume but could be wrong.
Cabazon California. Now THERE is a REAL garden spot!
Sigh. Fond memories of “credenza wars” in the basement of the Pentagon.
“Does he have the appropriate credentials?”
“No, sir! But, he has the appropriate credenzas!”
“… serves at the pleasure of the President”
“Clean out your desk Lisa. Security will escort you out of the building.”
Do it for her. They cleaned James Comey’s desk while he was in LA .
I fired a department manager while she was on vacation in Iran.
She came back to find that I had hired six new engineers for her department and one of them was sitting at her desk and had her job title.
Off to OD for out-processing.
“OK, Cook has a point.
In America, no one should lose their job or face any consequences over allegations.
If the DOJ has sufficient evidence of mortgage fraud against Cook, then it should indict her.”
This is nonsense. When a gas station manager catches an employee taking money from the till, they don’t have to wait for an indictment or conviction. That employee is fired then and there. And at that point it’s just an accusation. With some good evidence perhaps. But there’s pretty good evidence here.
The vast majority of people in America are employed “at will” and not governed by any employment contract. Thus they can be fired at any time and no reason need be given. Conversely, any “at will” employee can tell his employer to go take a hike and quit, no reason necessary.
You can lose your job at any time, allegations or otherwise. Allegations just make it easier or more likely for the boss to let you go.
Yeah it would be nice if people didn’t face immediate consequences from mere allegations but that ship sailed long ago. Two decades ago the Duke Lactose team got hemmed up in false allegations. A couple decades prior to that Clearance Thomas faced the potential derailment of his nomination to SCOTUS over unsubstantiated allegations Today it continues with Kavanaugh among other high profile and many much lower profile individuals who’ve had careers derailed, reputation tarnished by unsubstantiated allegations.
The allegations here ain’t exactly unsubstantiated, Cook had two mortgages simultaneously claiming each as the primary residence to secure more favorable lending terms associated with a primary v 2nd home or a rental home/investment property. The papers are in public and she hasn’t denied their accuracy or the ‘allegations’ she fraudulently claimed two homes simultaneously as her primary residence.
It’d be fairly easy to show the paperwork if she’s getting treated unfairly.
Bring the receipts… it shuts people up real fast.
Neither she nor her lawyer mentions the reason she is being fired – mortgage fraud, though her lawyer claims it doesn’t matter as it took place before she was nominated for the Fed. Of course, she didn’t bother to notify the Senate what she had done either. Should be a fun court case.
In a related note, apparently Cook’s lawyer is also representing Letitia James and Hunter Biden. Makes you wonder if some dem-friendly billionaire is funding this round of lawfare. Cheers –
Soros?
“But I am a black woman and therefore untouchable.” That defense wore thin a long time ago and hiring them was a strategy employed by the Dems to place people in positions (often for which they were highly unqualified for) where they could both do the bidding of another and could not be removed. We have one in Oregon right now which strains disbelief, where she was an overpaid director of preschools and used her position to register 9 students at a family owned pre-school for the tune of $90K plus a year. The entire pre-school for all movement has been an indoctrination and grifting scam from the get-go, to the point where those involved didn’t want her removed for cause because it gives momentum to investigate the other scams that are still running. She has lost her job so far, but no one seems to excited about recovering the $750K overpayments to family members, and sending her to prison for 5 years. Even the governor wants the free pre-school shut down because it has become too obvious, and is now causing the high-income victims of the special taxation to leave Multnomah county and the state. Gee, the nerve of them.
The suit uses the term “unsubstantiated allegation.” The word “unsubstantiated” is an outright lie. There is substantiation in the form of paperwork with her signature on it.
Only in the government do employees think that they have to agree to their firing for it to take effect.
They are amateurs compared to the perps on police chase videos. “I didn do nuttin” after a 15 minute 120moph chase across town. Even better are the ones who think that if they can just make it to granmas house that their car won’t be towed and she will make it all go away. Following the rules of GTA is no way to get through life successfully.
You left out repeating the same thing over and over again.
There is a belief among The Protected Demographic that doing this makes the statement true.
Which demographic is that, Yogi? It’s not them again is it?
The 13%.
Alas, BooBoo, it is.
Notice the neither her or her celebrity lawyer claim she is innocent only that Trump can’t remove her. I look for this to head to SCOTUS and have not only the separation of powers looked at but also independent agencies in the government, who is in charge and if they can be fired by anyone.
She can fight this but in the . meantime she should be locked out of the building and her computers as well as have her security clearance revoked.
We have seen her signature on 2 mortgage applications claiming homestead in two different states at the same time. Unless she can explain that, she should be fired and prosecuted. Looks like Pres Autopen’s DEI hiring strikes again as another incompetent is exposed
Exactly – nobody denies she broke the law. She is not denying it. Her defense is It happened before she got hired at the Fed. And that plus five bucks will get you a coffee at Starbucks. Also, she still owns both homes, and still gets the privileged interest rate, hence she is still breaking the law.
I think that the attorney’s argument is that “unsubstantiated” means “not proven in a court of law.”
The mere existence of documents with her signature and a demonstration that she financially benefited, in his view, is not enough.
I also think that his second argument is that “even if she is dishonest, she didn’t do anything bad at work.”
I don’t have enough knowledge to make an informed opinion on whether he has a case.
Oh boy discovery in this case will be interesting. It also brings up something that I think many have not seen, the legality of the Federal Reserve in general related to the operation of the Treasury Department and this suit calls into view if the FED is a private entity or a public one.
So let me get this straight…her argument is that she can’t be fired for crimes she commits outside the scope of her job, but regular joe can be fired for such? That shouldn’t pass muster in a sane world.
What if she murders someone? Can she stay on the Fed if it’s just because of a personal, jealous rage?
“into view if the FED is a private entity or a public one.”
******
I think that is the purpose of this move. I don’t think that the Trump team particularly cares about Lisa Cook’s fraud and firing her. They are using her as a possible entry point to challenge the limits of the alleged independence of the Fed. and it’s relationship to the Executive branch.
She’s being used and will regret it later.
This is classic FAFO. She has just managed to turn her firing into a conviction followed by a firing. She should’ve left it alone.
It just got worse.
https://x.com/pulte/status/1961239276148199679
If she got lower rates, the theft is ongoing.
States where I have lived offer lower property tax rates for primary dwellings. So the theft would be ongoing.
This is annoying to me because I had a change of residence during covid. I own only one property and live rent free in my son’s vacation house. The taxes on the house I own went from $2000 to $8000. Since I am not privileged, I was not given to option to continue claiming my only house as my residence.
But…but…but…I’m black.
“I am a woman ‘of color’ — hear me whine.”
“alleged mortgage fraud came up during her Senate confirmation hearing.”
It did not.
Also note – nowhere in her lawsuit does she deny committing the fraud. That speaks volumes. Her lawsuit is over whether Trump has the legal authority to fire her. He does, clearly.
If the president can fire someone “for cause,” I submit that credible allegations of mortgage fraud (or, other criminal act/impropriety suffice as grounds for a firing.
Cook has been “credibly accused,” as the vile Dhimmi-crats like to say.
From a non-lawyer.
Exactly WHAT is the Constitutional basis for an “independent agency”. Back in my high school civics class–circa 1960–we were taught that the Legislative Branch passed laws, the Executive Branch enforced them, and the Judicial Branch interpreted them.
So–where does an “independent agency’ fall? What Branch? If they are independent of the Executive branch, aren’t they a parallel government? What is the Constitutional basis for such? Are they unaccountable? If not, WHO are they accountable to.
Federal Judges cannot be fired by the Executive, because they aren’t are a separate branch. Congressmen and Senators, likewise, cannot be fired by the Executive.
“OK, Cook has a point.
In America, no one should lose their job or face any consequences over allegations.”
In the real world, dead wrong.
I am wholly a creature of the private sector. About 50 years as A “c-level” executive, about 35 as a CEO.
“Loss of confidence” is all it takes. If it came to my attention that my CFO had been caught in personal financial irregularities, that would be it. Clean out your desk. Not only because I personally would no longer be certain that I could trust him/her, but if it turned out that the “irregularities” extended to the workplace and I HADN’T taken immediate action, I would create a justifiable liability for both myself and my company. Firing would both be a proactive and defensive move.
“If the DOJ has sufficient evidence of mortgage fraud against Cook, then it should indict her”
They damned well better.
economic genius no f ing doubt Surely a meritocratic appointment, no?
The President’s better course of action might be, given a palpable allegation of fraud, to suspend her with pay pending indictment; without pay once indicted through the trial process, then firing upon conviction. It’s basically a due process “cause” argument versus protecting the public interest.
She is a ‘governor’ at an agency that does things that affect mortgage rates.
She is committing fraud related to mortgage rates.
She cannot be trusted to ‘govern’ the nation’s mortgage rates if she cheats on her own mortgage rates.
Next.