Judge Blocks Trump from Removing Fed Governor Lisa Cook — For Now

A federal judge has temporarily barred President Donald Trump from firing Federal Reserve Governor Lisa Cook, handing the White House an early defeat in an unprecedented clash over the central bank’s independence.

Trump announced in August that he had dismissed Cook, alleging she committed mortgage fraud before taking office — a charge she denies. The Fed has maintained that Cook remains a sitting governor, one of the board members who help set US interest rates.

In Tuesday’s preliminary ruling, District Judge Jia Cobb wrote that the law allowing Fed governors to be removed “for cause” does not cover alleged conduct prior to their appointment. “‘For cause’ thus does not contemplate removing an individual purely for conduct that occurred before they began in office,” she ruled.

Cook, who sued Trump last month to block his removal order, has asked the court to declare it “unlawful and void.” Her lawyer, Abbe David Lowell, welcomed the decision, saying it “reaffirms the importance of safeguarding the independence of the Federal Reserve from illegal political interference.”

Trump, joined by Federal Housing and Finance Authority director William Pulte, claims Cook misrepresented property details on three mortgage applications, allowing her to access lower rates and tax credits. The White House has not commented on the ruling.

The case marks the first time a US president has sought to remove a Fed governor, and legal experts expect it to reach the Supreme Court. The outcome could set a defining precedent for the central bank’s autonomy in setting monetary policy free from political pressure.

The ruling comes just days before the Fed meets to decide on what is widely expected to be its first interest rate cut since September 2024. Trump has repeatedly pressed the central bank, including chair Jerome Powell, to slash borrowing costs in a bid to spur economic growth.