The Trump administration on Thursday formally petitioned the Supreme Court to allow President Trump to remove Federal Reserve Governor Lisa Cook from her position without delay. If the court agrees, it would mark the first time a Fed governor was fired by a president in the central bank’s 111-year history.
A federal appeals court on Monday rejected Trump’s attempt to fire Cook, with the three-judge panel of the U.S. Court of Appeals for the D.C. Circuit issuing a 2-1 emergency ruling ahead of the central bank’s start of monetary policy meetings on Tuesday. By law, Federal Reserve governors can only be removed for misconduct or other qualifying reasons. The White House has repeatedly insisted that Trump acted within his authority by seeking Cook’s removal.
In the Supreme Court filing, Solicitor General D. John Sauer argued that a lower court’s decision preventing the dismissal amounted to “improper judicial interference.” Sauer wrote that “The Federal Reserve Board plays a uniquely critical role in the American economy. That reality only underscores the public’s interest in ensuring that an ethically compromised member is not permitted to wield its significant powers.”
The president invoked a clause in the Federal Reserve Act that allows members to be dismissed “for cause,” pointing to allegations of mortgage fraud against Cook raised by Federal Housing Finance Agency Director Bill Pulte, a Trump appointee. Pulte sent criminal referrals for Cook to U.S. Attorney General Pam Bondi twice since Aug. 15, accusing Cook of mortgage fraud, alleging she listed properties she owns inconsistently on different forms.
Cook has firmly denied the accusations, and she has not been charged with any crime. Cook has also fought back arguing that Trump doesn’t have the authority to fire her. Cook challenged her removal in court, and won reinstatement. The district found that her firing likely violated the so-called for-cause provision of the Federal Reserve Act and the Fifth Amendment’s Due Process Clause.
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