Trump Says He Removed Key Federal Reserve Official, Governor Lisa Cook

President Donald Trump just said he removed a key official at the Federal Reserve, and it wasn’t Jerome Powell.

Trump said in a letter posted to Truth Social on Monday that he was removing Fed Governor Lisa Cook, citing recent allegations made against her by Bill Pulte, director of the Federal Housing Finance Agency.

Pulte, in a letter to the attorney general posted on X last week, accused Cook of making at least one false statement on mortgage agreements by having mortgages on two properties in two different states and describing both as her primary residence.

“Pursuant to my authority under Article II of the Constitution of the United States and the Federal Reserve Act of 1913, as amended, you are hereby removed from your position on the Board of Governors of the Federal Reserve, effective immediately,” the letter posted to Truth Social reads.

Markets reacted immediately as investors questioned the Fed’s independence. The US Dollar Index was 0.2% lower at 10:14 p.m. ET, and benchmark 10-year Treasurys were also lower.

US futures were lower:

S&P 500 futures: down 0.1% at 6,446.50Nasdaq futures: down 0.2% at 23,446.25Dow futures: down 0.1% at 45,307.00

Haven assets rose as investors rushed to safety. Gold was 0.3% higher at around $3,376 per ounce, and the Japanese yen rose 0.2%.

Supreme Court collision course

Trump’s decision to try to fire Cook puts him on a collision course with the Supreme Court, which has so far given him the green light to fire members of independent agencies.

A president can only remove a Federal Reserve governor for cause. Earlier this year, the Supreme Court allowed Trump to temporarily remove members of the National Labor Relations Board and the Merit Systems Protection Board while further litigation played out over whether presidents have the power to remove them without cause.

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In one of those opinions, the conservative majority said the removals would not “implicate the constitutionality of for-cause removal protections” for Federal Reserve members because of the agency’s “distinct historical tradition.”

“The Federal Reserve is a uniquely structured, quasi-private entity that follows in the distinct historical tradition of the First and Second Banks of the United States,” the unsigned opinion said.

Last week, in response to Trump’s calls to resign, Cook said, “I have no intention of being bullied to step down from my position because of some questions raised in a tweet,” according to a statement issued by the Fed.

The statement continued, “I do intend to take any questions about my financial history seriously as a member of the Federal Reserve, and so I am gathering the accurate information to answer any legitimate questions and provide the facts.”

The Fed is scheduled to meet in less than a month. Its rate-setting Open Markets Committee has provisions to allow for alternate voters when a governor or a member of the panel misses a vote. It remains unclear how the Fed will proceed.

Last week, Powell said that the Fed would always make rate-setting decisions solely based on the judgment of the needs of the broader economy to balance inflation and unemployment — a once perfunctory message that has taken on renewed relevance amid Trump’s frequent efforts to cajole the Fed into cutting rates.

“FOMC members will make these decisions, based solely on their assessment of the data and its implications for the economic outlook and the balance of risks,” Powell said during his closely-watched speech during an economic policy summit in Jackson Hole. ‘We will never deviate from that approach.”

The White House and the Federal Reserve did not immediately respond to a request for comment from Business Insider.

Correction: August 25, 2025 — This story was corrected to include the correct spelling of Bill Pulte’s last name. It is Pulte, not Plute.