Trump’s Probe into Fed Governor Lisa Cook Raises Concerns over Political Interference and Central Bank Independence

President Trump tapped his political appointees to determine whether he could oust Lisa Cook, a Fed governor he had already tried to oust.

· US President Donald Trump has appointed a special committee of political allies to investigate Federal Reserve Governor Lisa Cook over unproven allegations of mortgage fraud, renewing efforts to remove her from office.

· The allegations, first raised by federal housing director Bill Pulte, claim that Cook designated two properties as primary residences in mortgage applications. Cook and her lawyers deny wrongdoing and describe one designation as an inadvertent oversight.

· Trump has openly criticised Cook for opposing his demand for sharply lower interest rates, raising concerns that the investigation may be politically motivated rather than an impartial inquiry into the allegations.

· The Supreme Court blocked Trump’s earlier attempt to dismiss Cook in June, ruling that she had not been given sufficient opportunity to defend herself.

· The White House has scheduled a hearing for 5 November 2026, but Cook’s lawyers have raised objections over the committee’s impartiality, procedures and the legitimacy of the inquiry.

· The three-member panel comprises Kevin Hassett, Keith Sonderling and Andrea Lucas, all Trump administration appointees. Cook’s legal team has questioned the objectivity of panel members, particularly Hassett, who previously criticised her over the allegations.

· Legal experts have expressed concern that the process may be designed to achieve a predetermined outcome, despite appearing to meet procedural requirements established by the Supreme Court.

· The controversy forms part of Trump’s broader campaign to pressure the Federal Reserve to cut interest rates and challenge officials who disagree with his monetary policy preferences.

· The case has intensified concerns about the independence of the Federal Reserve, the fairness of presidential removal procedures and the potential use of investigations to exert political influence over monetary policy.

[ABS News Service/14.10.2026]

One day after announcing a special committee to investigate a sitting governor at the Federal Reserve, President Trump offered an unvarnished glimpse into what he expected his handpicked panel might find.

“I think she’s dishonest,” Mr. Trump told reporters on Saturday, referring to the Fed governor, Lisa D. Cook, whom he has been trying to oust since August last year.

The president barely acknowledged the stated reason for opening that inquiry: a set of year-old allegations, neither charged nor proven in court, that Ms. Cook had engaged in mortgage fraud. Instead, Mr. Trump pivoted to his longstanding complaint that Ms. Cook had not voted for the sharply lower interest rates he desires.

“She’s an automatic no vote, and that’s not a good thing,” he said.

The brief exchange laid bare the unusual scrutiny that awaits Ms. Cook, an economist and the first Black woman to serve as a Fed governor.

At the center are a set of allegations, first raised by Bill Pulte, the federal housing director, that Ms. Cook designated two homes as primary residences in mortgage applications. She and her lawyers have described one instance of that designation as an inadvertent oversight, not fraud, while supplying other records that show the property was classified appropriately.

Still, the fate of her tenure may rest in the hands of an unorthodox panel, assembled by Mr. Trump and staffed with his staunchest allies when he has made no secret of his belief that the Fed governor should lose her job. The White House has scheduled a hearing to question Ms. Cook for Nov. 5, though her lawyers said on Tuesday that she would not be able to attend because of a scheduling conflict and raised issues with the legitimacy of the inquiry.

Mr. Trump’s first attempt to fire Ms. Cook was blocked by the Supreme Court, which ruled in June that the president had not afforded her ample opportunity to defend herself. The decision seemed to grant the White House great deference to determine how to proceed, and Mr. Trump’s decision to subject Ms. Cook to a hearing appeared to fulfill the technical requirements outlined by the Supreme Court.

But the way Mr. Trump has forged ahead — and the people he tapped to decide Ms. Cook’s future — raised concerns that the entire construct will be unfair.

Kathryn Judge, a professor at Columbia Law School who has long studied the central bank, said the Trump administration on its face had “created a process that — if it was in good faith — does seem like it would suffice to get at the truth of what actually happened.”

But, she said, “pretextual” forces were likely to overshadow the hearing, particularly given Mr. Trump’s past comments about the Fed.

“It feels like they are going through a bunch of procedural hurdles, but that they likely have the outcome that they want already decided,” Ms. Judge said.

The White House declined to answer a set of detailed questions about the hearing and how it would work. But Matthew Middleton, a spokesman, defended the president’s investigation in a statement on Tuesday as an extension of his “constitutional duty.”

“The president is going beyond what the Supreme Court required by offering Lisa Cook an in-person hearing that will be conducted in a fair and open process,” he added.

The heightened scrutiny of Ms. Cook fits a pattern under Mr. Trump, who has taken a series of aggressive steps to pressure the central bank to lower interest rates — and to try to force out members who do not agree with his views.

Last year, the president subjected the Fed’s chair at the time, Jerome H. Powell, to a withering investigation into a renovation of the Fed’s headquarters. The central bank’s internal watchdog later found no wrongdoing by Mr. Powell, whose term as chair ended in May, but that did not stop Mr. Trump from calling for him to resign from his role as a governor, a position he can remain in until 2028.

At one point, Mr. Trump even mused aloud that other members of the Fed had been installed through illegitimate means, though he never raised the matter again. After the Fed raised rates last month, the president attacked the board of governors for being political, though he spared Kevin M. Warsh, his new chairman, from the criticism.

“We want low interest rates,” Mr. Trump said on Saturday during a rally in Clarksville, Tenn. “Unfortunately, we have a bad board put in by other presidents, to a large extent.”

Ms. Cook’s lawyers have fiercely maintained that she is innocent, pointing to records that appear to show she accurately described one of the residences as a vacation property. But the explanations have not satisfied Mr. Trump.

After the Supreme Court intervened, Mr. Trump’s aides informed Ms. Cook in a letter in August that the White House was still “considering” whether to fire her — while giving her 21 days to prove her innocence. Her lawyers filed a defiant formal reply, pointing to news reports that indicated other administration officials had made similar designations on their mortgage documents.

Lev Menand, an associate professor at Columbia Law School, said the exchange of letters between the White House and Ms. Cook’s lawyers might have been enough to satisfy the justices’ requirements. Their order specifically raised the possibility that she could be afforded a hearing entirely in writing.

Yet the administration opted last week to impanel the special committee. Mr. Menand said he wondered if the reason was that the White House had not been able to amass enough evidence to justify Ms. Cook’s ouster.

“If the record after the initial exchange of notice and documents by Cook’s attorneys was sufficient to ground the removal, one would have expected a removal to have taken place,” added Mr. Menand, a former economist at the Federal Reserve Bank of New York. He said the hearing might be an “attempt to get her to contradict something she has said in the record.”

A series of letters viewed on Tuesday by The New York Times showed that Abbe Lowell, a lawyer for Ms. Cook, seemed skeptical about the hearing from the start.

In an Oct. 5 letter, Mr. Lowell acknowledged a previously unreported discussion with the administration about a possible hearing, and expressed an openness to participating. But he still raised scheduling conflicts, questioned how the hearing would work and doubted the “sincerity of this inquiry.”

Under the directive that Mr. Trump issued days later, Ms. Cook could face up to four hours of closed-door questioning at the White House. The session could feature questioning by the Justice Department, which received a referral last year from Mr. Pulte, the housing director, to investigate Ms. Cook.

To carry this out, Mr. Trump named three political appointees to the committee: Kevin Hassett, the director of the White House National Economic Council; Keith Sonderling, the new secretary of labor; and Andrea Lucas, the chair of the Equal Employment Opportunity Commission.

Mr. Hassett and Mr. Sonderling, who is also the acting leader of a government ethics office, have echoed the president’s calls for lower interest rates.

Last year, Mr. Hassett described the allegations against Ms. Cook as “serious” and called on her to take a leave of absence until the matter was resolved. “The fact she’s not doing that now suggests she’s being partisan,” he told reporters at the time.

The political nature of the hearing angered Ms. Cook’s legal team. In a follow-up letter, sent on Tuesday, Mr. Lowell raised “significant concerns regarding the objectivity and fitness of the committee,” singling out Mr. Hassett’s comments. He also said Ms. Cook would be unavailable to attend in November, citing conflicts related to her work with the Fed.

“A hearing with demonstrably biased members, unspecified additional allegations and an unclear schedule for the disclosure of any additional evidence — with no explanation for why it was not previously produced — is not a process that respects the appearance or history of independence,” Mr. Lowell said.

How that process will unfold remains unclear, including whether Ms. Cook would be required to testify under oath. Mr. Trump’s order establishing the investigation also appeared to give the administration a wide berth to change the rules, allowing the panel to “establish additional procedures or make reasonable changes” as necessary.

The unusual setup led Peter Conti-Brown, an expert on Fed governance at the University of Pennsylvania, to describe the situation in recent days as a “panel of quasi judges in a quasi-judicial process to allow Lisa Cook to answer these allegations.”

That, he said, might satisfy the basic requirements outlined by the Supreme Court. But he added, “It’s worth saying out loud what everyone knows: This is all pretext.”