The White House has scheduled a closed-door hearing on November 5 for Federal Reserve governor Lisa Cook to address allegations of mortgage fraud, a development that could lead to renewed efforts by President Donald Trump to remove her from the central bank’s board. The hearing, ordered by a presidential memorandum dated October 7, represents the latest step in the administration’s ongoing attempt to gain greater influence over the Federal Reserve and follows a Supreme Court ruling that blocked Mr. Trump’s initial attempt to dismiss Ms. Cook.
Ms. Cook, appointed to the Fed board by former President Joe Biden with a term extending through 2038, has denied the mortgage fraud allegations. The controversy began last year when Bill Pulte, director of the Federal Housing Finance Agency and a Trump adviser, presented documents alleging that Ms. Cook had listed more than one property as her primary residence in mortgage applications. President Trump moved to fire her abruptly on social media, leading Ms. Cook to file a lawsuit challenging his authority to remove her without due process.
U.S. District Judge Jia Cobb blocked the initial firing, allowing Ms. Cook to remain in her position while the lawsuit proceeded. The Supreme Court affirmed that ruling in June, requiring any removal to be accompanied by minimal procedural protections to ensure fairness. The upcoming White House committee hearing, which includes Kevin Hassett, director of the National Economic Council, Equal Employment Opportunity Commission chair Andrea Lucas, and Office of Government Ethics director Keith Sonderling—all Trump appointees—is designed to comply with these judicial requirements by allowing Ms. Cook to respond to the allegations.
The process outlined in the memorandum specifies that Ms. Cook will be “examined by the committee” and permitted to submit a “position statement,” with the hearing lasting no longer than four hours. The committee will then submit written findings and a recommendation regarding whether “cause” exists for her removal. If the committee advises removal, President Trump could again seek to dismiss Ms. Cook, prompting further judicial review.
Ms. Cook’s legal representatives, Abbe Lowell and Norm Eisen, expressed skepticism about the fairness of the hearing in a joint statement, suggesting it might be “a box checking exercise” rather than a genuine inquiry. They maintained that if conducted impartially, the hearing would conclude she did not commit mortgage fraud and that there is no cause for her removal.
The Federal Reserve is established as an independent institution to insulate monetary policy from political pressures, and no sitting Fed governor has ever been removed by a president before. The Federal Reserve Act allows removal “for cause,” but courts have yet to clarify the scope of this standard for Fed officials.
This hearing represents a significant moment in the ongoing legal and political dispute over the boundaries of presidential power over the Federal Reserve, with implications for the future independence of the central bank. A joint proposal regarding how Ms. Cook’s lawsuit should proceed is also due the day after the hearing before Judge Cobb, who will ultimately decide the outcome of the case.