Federal Reserve Governor Lisa Cook today filed a lawsuit against President Trump for his attempt to remove her from the Fed board, saying the president’s actions are “unprecedented and illegal.”
Trump earlier this week announced he was removing Cook after Federal Housing Finance Agency Director William Pulte alleged that she made false statements on mortgage agreements. Pulte’s claims have not been substantiated. Cook’s term on the board doesn’t expire until 2038, but the Federal Reserve Act allows the president to remove board members “for cause.”
In a lawsuit filed in U.S. District Court for D.C., Cook argues that the Fed’s operational independence “is vital to its ability to make sound economic decisions, free from the political pressures of an election cycle.” Given that the allegations against her have not been proven, the president’s actions “violate Governor Cook’s Fifth Amendment due process rights and her statutory right to notice and a hearing under the [Federal Reserve Act].”
The lawsuit asks the court to void Trump’s order and to rule that the allegations made against her do not constitute “for cause.”
The lawsuit also names the Fed and Fed Chairman Jerome Powell as defendants. Powell was included “to the extent that he has any ability to take any action to effectuate President Trump’s purported termination of Governor Cook.”
Editor’s note: This story has been updated since publication to correct the end date for Cook’s current term on the Fed board.
