Trump Removes Fed Governor Lisa Cook in Unprecedented Move

• Aug 26, 2025

President Donald Trump has announced the immediate removal of Federal Reserve governor Lisa Cook, escalating his ongoing battle with the central bank. The decision, revealed Monday night on his social media platform Truth Social, marks the first time in the Federal Reserve’s 111-year history that a sitting board member has been dismissed by a president.

In a letter addressed to Cook, Trump cited “sufficient reason” for her removal, alleging that she made false statements on mortgage agreements. He claimed constitutional authority to take the action without delay. Neither Cook nor the Federal Reserve has issued a statement in response.

Cook, the first African American woman to serve on the Fed’s board of governors, had faced growing pressure from Trump in recent weeks. He accused her of mortgage fraud, pointing to two property documents: one in Michigan where she pledged to reside for a year, and another in Georgia signed just two weeks later with the same commitment. Trump argued this demonstrated dishonesty.

The allegations were first raised publicly in a letter sent by housing finance regulator Bill Pulte, a Trump ally, to Attorney General Pam Bondi. The letter, described as a “criminal referral,” urged the Justice Department to investigate. It remains unclear whether federal authorities have launched an inquiry.

Cook rejected the claims last week, telling the BBC she learned of them through media reports. She said the matter was linked to a mortgage application she made four years ago, before joining the Fed. She vowed not to resign, saying: “I have no intention of being bullied to step down because of some questions raised in a tweet.”

Trump’s decision to remove her could face significant legal challenges. Experts note that the White House would need to prove in court that it had valid grounds for dismissal, raising the possibility of a constitutional clash between the presidency and the central bank. The Fed has operated independently from the U.S. government since 1951.

The move also comes amid Trump’s increasing attacks on Fed Chair Jerome Powell, whom he has criticized for refusing to slash interest rates quickly. Powell, however, recently signaled that a rate cut may be possible in September, while cautioning that Trump’s tariffs could temporarily increase inflation.

Observers say Cook’s removal could spark a major test of the Fed’s independence, setting the stage for a potential legal and political showdown between the White House and the central bank.