On Thursday, September 18, 2025, former US President Donald Trump filed an emergency request with the Supreme Court seeking permission to remove Federal Reserve Governor Lisa Cook from her position. This legal move follows a recent appeals court decision that blocked Trump's attempt to oust Cook, who has been accused by the Trump administration of mortgage fraud, allegations she denies.
The case centers on the interpretation of the Federal Reserve Act, which allows Fed officials to be removed only "for cause," a standard generally understood as malfeasance or neglect of duty. No Federal Reserve official has ever been fired in the institution's 111-year history, and this legal challenge could set a precedent affecting the central bank's independence.
Lisa Cook sued Trump in August after he sought to fire her, arguing that the President lacks the authority to remove a Fed governor without cause. The Justice Department, representing Trump, contends that the President acted within his rights to remove an ethically compromised member from the Federal Reserve Board, emphasizing the importance of maintaining public trust in the institution.
The allegations against Cook involve two properties in Michigan and Georgia, which the Trump administration claims were misrepresented as her primary residence. However, a loan estimate for a 2021 Atlanta home purchase showed Cook declared the property as a "vacation home," undermining the administration's claims.
Federal Reserve Chair Jerome Powell, who is named as a defendant in the case due to his role in executing the President's orders, declined to comment on the ongoing legal proceedings, stating it would be inappropriate to do so. Both the Federal Reserve and the White House have stated they will abide by the court's decision.
This legal battle comes amid ongoing tensions between Trump and the Federal Reserve, with Trump criticizing the Fed's monetary policy decisions, including interest rate settings. The Federal Reserve recently cut interest rates by 25 basis points, signaling potential further reductions this year.
If Trump succeeds in removing Cook, he would be able to nominate a replacement to serve the remainder of her term, which expires in 2038. Experts warn that such a move could undermine the Federal Reserve's independence, a cornerstone of global financial stability and the US dollar's role in the world economy.
The Supreme Court's decision on this matter could have far-reaching implications for the balance of power between the executive branch and the Federal Reserve, as well as for the future conduct of US monetary policy.
