The US justice department has launched a criminal investigation into federal reserve governor Lisa Cook, issuing subpoenas in Georgia and Michigan as part of a probe into alleged mortgage fraud.The investigation, first reported by the Wall Street Journal, centers on whether Cook allegedly committed fraud by listing more than one property as her primary residence when applying for mortgages. Cook owns properties in Michigan, Georgia, and Massachusetts.A source familiar with the matter told The New York Post that a grand jury in Atlanta is examining Cook, and “it’s likely an indictment could come.”The allegations, originally raised by Bill Pulte, head of the Federal Housing Finance Agency, claim Cook declared two homes—one in Ann Arbor, Michigan, and another in Atlanta—as her primary residence in 2021 to obtain favorable loan terms. Pulte referred the matter to the Justice Department, which has opened an investigation at his request.
Trump attempts to remove fed governor
The move comes after US President Donald Trump attempted to remove Cook from the Federal Reserve board, accusing her of mortgage fraud dating back to 2021, before she joined the board.Trump announced Cook’s dismissal through a letter posted on Truth Social. “In light of your deceitful and potentially criminal conduct in a financial matter, [Americans] cannot and I do not have such confidence in your integrity,” he wrote. “I have determined that there is sufficient cause to remove you from your position,” he added.
Cook sues Trump administration
After Trump attempted to remove her, Lisa Cook filed a lawsuit against his administration.Her suit contends that the claims have no connection to her work at the Federal Reserve and remain unproven. It also argues that she was not given an opportunity to respond before being targeted. “The unsubstantiated and unproven allegation that Governor Cook ‘potentially’ erred in filling out a mortgage form prior to her Senate confirmation—does not amount to ’cause,’” the filing states, as cited by AP.Cook’s lawsuit further claims that the allegations are merely a pretext to remove her: “The mortgage allegations against her are pretextual, in order to effectuate her prompt removal and vacate a seat for President Trump to fill and forward his agenda to undermine the independence of the Federal Reserve.”The case is being seen as an extraordinary legal fight that could redefine the Fed’s independence. In the institution’s 112-year history, no US president has ever attempted to fire a Federal Reserve governor until Trump announced Cook’s removal.Observers expect the legal battle to ultimately reach the Supreme Court. The Court has previously ruled that the president cannot dismiss Fed officials over policy disagreements but can do so “for cause,” a term that usually covers misconduct or neglect of duty.
