U.S. Appeals Court Blocks Trump’s Attempt to Oust Fed Governor Lisa Cook

A U.S. appeals court has rejected President Donald Trump’s attempt to fire Federal Reserve Governor Lisa Cook. This marks the first time a U.S. president has tried to remove a Fed governor. The court’s decision allows Cook to attend the Fed’s upcoming policy meeting, where a potential interest rate cut is expected. The court’s ruling was based on the argument that Cook was likely denied due process, as the administration provided no meaningful notice or opportunity for her to respond to the allegations against her.

The Legal and Political Stakes

The case is a major test of the Federal Reserve’s long-standing independence. The law that established the Fed allows a president to remove a governor only “for cause,” a term that has never been legally defined or tested in court. While the court’s decision did not define “for cause,” it upheld a lower court’s temporary block on Cook’s removal. This legal battle is unfolding against a backdrop of political tension, with Trump having publicly pressured the Fed to cut interest rates. The outcome of this case has significant implications for the Fed’s ability to set monetary policy without political interference.

The Allegations and the Defense

The Trump administration’s claims that Cook committed mortgage fraud before taking office were at the heart of the case. Cook has denied these allegations, and a Reuters review of property records appears to undercut some of the claims. Cook’s lawyers have argued that the allegations are a pretext for her removal, which is really motivated by her monetary policy stance. The ongoing legal and political battle highlights the intense scrutiny surrounding the Fed’s role in the U.S. economy.