Judge Blocks Trump’s Attempt to Remove Fed Governor Lisa Cook

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Photo:Reuters

In the United States, a major political and financial clash is unfolding that could shape the future of the world’s largest central bank. On Tuesday, September 9, 2025, a federal judge temporarily blocked President Donald Trump’s attempt to remove Federal Reserve Governor Lisa Cook from her position.

This legal decision marks the beginning of a rare and dramatic battle between the White House and the Federal Reserve, an institution that plays a crucial role in controlling inflation, interest rates, and the stability of the American economy. Experts say this fight could have long-lasting consequences for how much power a president has over the central bank, which is supposed to operate independently of politics.

The Court’s Ruling

Judge Jia Cobb of Washington, D.C., issued a preliminary ruling stating that President Trump cannot fire Lisa Cook—for now. The judge explained that the law creating the Federal Reserve allows governors to be removed only “for cause,” but that phrase has never been clearly defined in court.

According to Judge Cobb, “for cause” should only apply to actions taken while in office, not to alleged events that happened before someone started the job. Since Lisa Cook became a Fed Governor in 2022 after Senate confirmation, the judge suggested that any personal matters from before her term may not be valid reasons to remove her.

The Allegations Against Lisa Cook

The Trump administration has accused Ms. Cook of committing mortgage fraud years before she joined the Fed. Officials, including William Pulte, the head of the Federal Housing and Finance Authority, claim she misstated details about three properties on mortgage applications. They argue this may have allowed her to get lower interest rates and extra tax benefits.

The Justice Department has reportedly opened a criminal investigation and issued grand jury subpoenas in both Georgia and Michigan. Despite this, Ms. Cook has firmly denied any wrongdoing, saying in court documents:

“I have never committed mortgage fraud.”

Her lawyers further argue that even if these claims were true, they happened before she was confirmed as a Federal Reserve governor, and therefore cannot be used as legal grounds to remove her.

Why This Case Matters

No U.S. president has ever removed a Federal Reserve governor. The Fed was designed to be free from direct political pressure, so that leaders cannot force monetary decisions—like cutting or raising interest rates—for personal or political gain.

President Trump, however, has openly criticized the Fed for not lowering interest rates fast enough. He has demanded large and immediate rate cuts to stimulate the economy, and he has repeatedly clashed with Fed Chair Jerome Powell over monetary policy.

The central bank is expected to cut rates during its September 16–17 meeting, but the timing and scale are uncertain. Many economists worry that if the president can fire a Fed governor for past personal matters, it will weaken the bank’s independence and set a dangerous precedent for the future.

Lisa Cook’s Role and Significance

Lisa Cook is not only the first Black woman to serve on the Federal Reserve Board of Governors, but also a respected economist with decades of academic and policy experience. Her appointment in 2022 was seen as historic, adding diversity and new perspectives to the central bank.

Her stance on monetary policy is considered careful and balanced. Critics of the White House argue that the attempt to remove her is not really about mortgage paperwork, but about silencing voices within the Fed who do not support Trump’s push for aggressive interest rate cuts.

What Happens Next

The current ruling only pauses the removal process. The case is expected to continue in higher courts and may eventually reach the U.S. Supreme Court. Legal experts say the outcome could permanently define how much power presidents have over the Federal Reserve.

If the courts rule in Trump’s favor, future presidents could have far more control over monetary policy, effectively reducing the Fed’s independence. If the ruling sides with Lisa Cook, the Fed’s shield from political interference will be strengthened.

For now, Ms. Cook remains in her post, and the world will be watching closely as the September Fed meeting approaches. The case has already rattled financial markets and sparked debates about the balance of power in America’s government.

Central bank independence