U.S. President Donald Trump has dismissed Lisa Cook, a member of the Federal Reserve (Fed), amid escalating friction between the government and the Federal Reserve. Cook, who was notified of her dismissal on fraud charges, hinted at a possible lawsuit, but President Trump immediately began preparations for selecting her successor.
On the 26th (local time), President Trump stated during a Cabinet meeting in response to reporters' questions that he is considering "very good candidates" for Cook's successor. He further remarked on Cook, saying, "It seems she has committed illegal acts, and that shouldn't be."
Earlier, the U.S. Department of Housing and Urban Development discovered two instances of fraud related to Cook and referred the matter to the Department of Justice for investigation. Cook obtained real estate loans in Michigan and Georgia in 2021, submitting documentation for residential use but is now under suspicion of fraud for later renting out the Georgia real estate.
Shortly thereafter, President Trump notified that he was immediately dismissing Cook from her position under the authority granted by Article 2 of the Constitution and the Federal Reserve Act of 1913, having disclosed the dismissal notice letter on Truth Social. Cook has stated that instead of complying with the dismissal order, she will file a lawsuit.
The Federal Reserve is also showing signs of supporting Cook. On the 26th, the Federal Reserve stated in a release that "the long terms of the directors and the protection against their dismissal are important safeguards to ensure that monetary policy decisions are based on data, economic analysis, and the long-term interests of Americans," adding that it will continue to carry out its duties as prescribed by law.
According to the Federal Reserve Act, the president can dismiss a director when there are significant reasons, which is considered in cases of felony charges or convictions. There has been no precedent of a U.S. president dismissing a Federal Reserve director.
President Trump's attempt to dismiss Cook is interpreted as an intent to pressure for a rate cut ahead of the Federal Open Market Committee (FOMC) meeting next month. If he dismisses Cook and appoints a "loyalist" as her successor, it could increase his influence over the Federal Reserve.
According to The Wall Street Journal (WSJ), President Trump is considering Stephen Mira, the White House economic advisor, and David Malpass, the former president of the World Bank (WB), as candidates for Cook's successor.