President Trump has created a three-member committee of inquiry to examine allegations that Federal Reserve Governor Lisa Cook made false mortgage statements and whether that is cause for her removal.
The White House announced Friday that a presidential memorandum, dated Wednesday, formally established the panel and set an in-person hearing at the White House for Nov. 5, two days after the midterm election.
Under the Federal Reserve Act, a president may remove a Fed governor only “for cause.” The new committee is tasked with investigating the mortgage-related allegations against Cook and reporting whether that legal standard is met, CNBC reported.
Cook, a nominee of former President Joe Biden, has denied wrongdoing. Her lawyers say the process is stacked. Senate Democrats call it a power grab. Trump’s memorandum frames it as a basic duty: officials who cannot be trusted to tell the truth should not keep their posts.
The memorandum is addressed to Attorney General Todd Blanche and posted on the White House website. It names three executive-branch officials to the committee of inquiry: Kevin Hassett, Trump’s top economic aide; Keith Sonderling, acting head of the Office of Government Ethics; and Andrea Lucas, chair of the Equal Employment Opportunity Commission.
Committee members may consult the Department of Justice and other agencies “to aid in its inquiry.” No outside independent arbiters are listed in the announcement.
In the memorandum, Trump wrote:
"As President, it is my job to ensure the laws are faithfully executed, including by firing subordinates who cannot be trusted to tell the truth and follow the law,"
He added the panel’s marching orders in plain terms:
"To assist me in carrying out that responsibility, the Committee shall investigate the allegations against Governor Cook and report to me whether there is 'cause' for Governor Cook's removal"
This is not the first round. Trump first tried to fire Cook last year after administration officials raised allegations that she made false statements on at least one mortgage-related document. Cook denied the claims and sued to block her dismissal.
A federal court temporarily barred the firing. In June, the Supreme Court narrowly upheld that lower-court ruling. The high court rejected the first bid because Cook had not been given proper legal due process. It did not rule that a president can never remove a Fed governor for cause, and it left room for a renewed effort with additional steps.
The June opinion even cited historical precedent for presidential inquiry panels, including one used by President William Taft in 1912.
In August, White House aide Dan Scavino told Cook by letter that Trump was again “considering” firing her in connection with the same mortgage allegations. The new committee and the Nov. 5 hearing are the formal next step.
The Federal Reserve declined to comment and referred questions to Cook’s counsel. Attorneys Abbe Lowell and Norm Eisen told CNBC they have already engaged the White House about whether the hearing can be genuine.
They put their skepticism on the record:
"In light of the President's repeated statements that he has already decided to fire Governor Cook, regardless of the facts and evidence, we have grave doubts that this 'hearing' is a legitimate one that would conform to the law,"
They also said that if the review is objective, Cook will be cleared:
"But if it is anything close to objective, the conclusion will be that Governor Cook did not commit mortgage fraud, leaving no cause to remove her from the Federal Reserve Board,"
In the same statement, they said Cook “welcomes the opportunity to present the facts” so she can clear her name and show there is no legal basis to fire her.
Sen. Elizabeth Warren, D-Mass., the top Democrat on the Senate Banking Committee, attacked the move later Friday morning. She accused Trump of “convening an illegitimate show trial in his dangerous quest to illegally take over our nation's central bank.”
Warren also told him to “end the war in Iran and cancel his chaotic tariffs” rather than “playing judge in a kangaroo court of his own making.”
Senate Minority Leader Chuck Schumer, D-N.Y., posted on X that Trump “is escalating his smear campaign against Lisa Cook while turning the presidency into a personal ATM: crypto schemes, taxpayer-funded propaganda ads, cash for his family, the list could go on forever.”
Schumer added: “This has nothing to do with 'ethical concerns.' It's about Trump trying to seize control of the Fed, something that would mean even more economic chaos for American families.”
Modern presidents have rarely used this device. Reporting on the memorandum notes no recent parallel. President William Taft appointed a committee in 1912 to investigate the Board of United States General Appraisers. President Herbert Hoover convened a similar panel in 1931 to probe statements by the president of the Navy League. The tool has sat largely unused for nearly a century.
Trump has repeatedly pressed the Federal Reserve to lower interest rates. He recently said that failure to cut by his handpicked Fed chair, Kevin Warsh, is the fault of a “hostile” board. Cook remains on that board. The mortgage allegations, the June due-process ruling, the August Scavino letter, and now the three-member inquiry form one continuous accountability fight, not a sudden invention.
The committee’s job is narrow on paper: examine the allegations tied to “one or more mortgage instruments,” then report whether there is “cause” for removal under the standard the Supreme Court identified. Cook will have a chance to appear in person at the White House on Nov. 5. Her lawyers say they will use it to clear her name. The White House says the president’s duty is to enforce the law against subordinates who cannot be trusted to tell the truth.
Public officials who sign legal documents do not get a free pass because they sit at the central bank, and a president who puts due process on the calendar after the courts demanded it is doing the job voters hired him to do.
