The United States Department of Justice appealed the decision of a judge who temporarily prevented President Donald Trump from dismissing Federal Reserve Director Lisa Cook for alleged accusations of mortgage fraud – keeping the case on the way to reach the Supreme Court.
The government presented, on Wednesday (10), an appeal to the Federal Court of Appeals in Washington to overthrow the decision. On September 9, district judge Jia Cobb concluded that Trump probably had no “just cause”, as provided for in Federal Reserve Law, to dismiss Cook. It is unclear how quickly the board of appeal will decide the case.
The impasse may influence the composition of the Fed Council during the long -awaited meeting of September 16 and 17, when the possible reduction in the interest rate will be voted. Cook may participate in the meeting while Cobb’s decision remains in force.
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Any defeat of Trump in the court of appeals will likely be quickly taken to the Supreme Court. The president may also try to bring the case directly to the judges if he considers that the Court of Appeals is taking too long.
In the decision, Cobb stated that Trump probably violated the Federal Reserve’s law trying to ward off Cook without “just cause”. The magistrate also understood that the president violated Cook’s constitutional right to due process of law, by announcing his resignation through a social network post, without offering a significant opportunity to dispute the accusations.
The White House harshly criticized the decision a few hours after its disclosure. Spokesman Kush Desai stated in a statement that Trump “legally removed Lisa Cook for just cause, due to charging charges of mortgage fraud, from his highly sensitive position to supervise financial institutions on the Federal Reserve Council of Governors.”
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“This decision will not be the final word on the subject,” said Desai.
Last month, Trump announced that he was firing Cook after the director of the Federal Housing Financing Agency (FHFA), Bill Pulte, accusing her of fraudulently list real estate in Michigan and Georgia as a “main residence” when obtaining mortgages in 2021, thus ensuring more favorable conditions on loans. Subsequently, Pulte added a third accusation involving a mortgage in Massachusetts.
Cook’s remaining dispute has quickly became the main point of tension in Trump’s attempt to exercise more control over the Fed, an institution he has repeatedly pressured to reduce interest rates.
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In the lawsuit filed last month, Cook’s lawyer classified the attempted dismissal as a power maneuver that could undermine trust in the Fed and cause “irreparable damage” to the US economy. The defense also stated that Cook never committed mortgage fraud.
Cook claims that Trump’s measure is part of a standard of political motivation. The president had already considered dismissing the president of the Fed, Jerome Powell, after criticizing him for not reducing interest rates quickly.
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