On Wednesday President Trump took to social media to demand the resignation of another top policymaker at the Federal Reserve — Fed Governor Lisa Cook — after one of his allies accused her of mortgage fraud.
“Cook must resign, now!!!” the president wrote on his Truth Social network before linking to a Bloomberg News article about the allegations.
But who is Cook? What actually happened with her mortgages? And would her possible departure increase the pressure on Fed Chairman Jerome Powell, whom Trump has been urging for months to cut interest rates?
Here’s a quick explainer.
Who is Lisa Cook?
Cook is an American economist who has been a member of the Federal Reserve Board of Governors since May 23, 2022. She is the first woman of color to sit on the board. She was appointed by former President Joe Biden and confirmed by the Senate by a 51-50 vote (with then-Vice President Kamala Harris breaking the tie). No Republicans voted to confirm Cook.
At the time, Republicans accused Cook of being “hyper-partisan,” pointing to her Twitter history as evidence.
Cook was educated at Spelman College, Oxford University and the University of California at Berkeley before serving as a professor at Harvard University and Michigan State University. She is considered an expert on international economics, especially the Russian economy and the economic history of African-Americans.
What is Cook being accused of?
In a letter dated Aug. 15 and posted to X on Wednesday, Federal Housing Finance Agency director Bill Pulte, a Trump appointee, urged Attorney General Pam Bondi to investigate a pair of mortgages Cook took out in 2021.
The first, dated June 2021, was for a property in Ann Arbor, Mich.; according to Pulte’s letter, the terms of the mortgage stipulated it would be Cook’s primary home address for at least a year.
The second, taken out a few weeks later, was for a property in Georgia — which Cook also listed as her primary home address, according to Pulte.
Primary residence mortgages typically mean a lower interest rate, a lower down payment and a lower credit score to qualify; mortgage loans for a second home usually cost more and are harder to get. Buyers generally aren’t allowed to simultaneously claim two primary residence mortgages.
Cook’s Georgia home was later listed as a rental — but in Pulte’s words, that doesn’t change the fact that she initially “falsified bank documents and property records to acquire more favorable loan terms, potentially committing mortgage fraud under the criminal statute.”
In a phone interview Wednesday with CNBC, Pulte insisted his actions were nonpartisan.
“There can be no mortgage fraud. This came across our desk, and it’s my duty to report it,” Pulte said. “It wouldn’t matter if she were a Republican or a Democrat. It is what it is.”
But, he added, “I think she needs to resign quickly.”
Will Cook resign?
So far, the Fed and the Justice Department have declined to comment about Pulte’s allegations. Cook hasn’t responded either.
In a commentary issued Wednesday, Jaret Seiberg, an analyst at TD Cowen Washington Research Group, speculated that “resigning will not end [any] legal probe,” so there’s really “no incentive for [Cook] to react to Pulte by departing.”
A few hours later, however, the Wall Street Journal reported that Trump has told aides he might try to fire Cook if she doesn’t resign, citing a senior White House official and another person familiar with the matter.
The only way for Trump to fire a Fed governor is “for cause,” according to a 1935 law. That standard has usually been interpreted to mean dereliction of duty or malfeasance.
“I think prior private misconduct would be a stretch,” Columbia University law professor Lev Menand told the Journal.
Trump has also mulled firing Powell.
What would happen if Cook goes?
There’s already one vacancy on the central bank’s board: Fed Governor Adriana Kugler, a Biden appointee, resigned earlier this month. Trump has nominated his chief economist, Stephen Miran, to take Kugler’s place.
If Cook leaves, that would create two vacancies — and it would leave only two governors appointed solely by a Democratic president out of a total of seven. (Powell was appointed to Fed roles by presidents of both parties, including Trump himself.)
Since returning to the Oval Office earlier this year, Trump has been loudly pushing Powell to further lower interest rates (while also threatening to sue him over pricey renovations at the Fed’s headquarters in Washington). But so far, central bankers have resisted the president’s pressure campaign and paused additional rate cuts while they ascertain the economic impact of his tariffs.
“Could somebody please inform Jerome ‘Too Late’ Powell that he is hurting the Housing Industry, very badly?” the president wrote Tuesday on Truth Social. “People can’t get a Mortgage because of him. There is no Inflation, and every sign is pointing to a major Rate Cut. ‘Too Late’ is a disaster!
Even without new appointees, however, Trump might soon get his wish. At a symposium in Jackson Hole, Wyo., this week, “Powell is widely expected to signal long-awaited rate cuts in the second half of the year, citing fragility in the labor market,” according to CNN.
Those cuts would come at the Fed’s September meeting.
