Fed’s Cook rejects Trump mortgage fraud claims

Federal Reserve Governor Lisa Cook vehemently rejected renewed mortgage fraud allegations from President Donald Trump on Wednesday, maintaining that the White House has no lawful basis to remove her from the US central bank's board. Her legal team, led by Abbe Lowell, submitted a response by the deadline set out in a letter from Trump dated August 5, which expressed his intention to oust Cook.

This is the second attempt by Trump to remove Cook since the Supreme Court blocked the first attempt in June, ruling that he had failed to provide her with notice and an opportunity to defend herself against the allegations. No president in the Federal Reserve's 113-year history has removed a sitting Fed governor.

The Federal Reserve, a non-partisan institution responsible for setting monetary policy for the world's largest economy, consists of governors appointed by the president after a Senate confirmation process. Governor Cook has emphatically denied any mortgage fraud or intentional wrongdoing, and there is no legally valid reason for her removal from the Federal Reserve Board, according to Lowell's letter.

The letter also pointed out that Trump and several of his cabinet officials have signed the same type of mortgage paperwork now being used against Cook. Trump has initiated an unprecedented attack on the independence of the Federal Reserve during his second term, launching a criminal investigation against former Chairman Jerome Powell and attempting to fire Cook.

The Supreme Court's June ruling emphasized the importance of the Fed's independence but did not address the underlying mortgage fraud allegations. Trump expressed anger at the verdict on social media, stating that he would take "appropriate action immediately" against Cook. The White House letter included detailed allegations against Cook, asserting that her conduct was "grossly negligent" and made her unfit for the office.

Cook, the first Black woman to serve as a Federal Reserve governor, has consistently maintained her innocence regarding the allegations.