The US Justice Department has rejected President Donald Trump's claims that he had the authority to fire Fed official Lisa Cook, arguing that her dismissal was “a pretext to pave the way for a rate cut.”
Cook, accused of mortgage fraud, has filed a lawsuit challenging his dismissal. Government lawyers reiterated arguments made at last week's hearing, arguing that Cook's request to block his dismissal pending trial should be denied.
The filing comes on the heels of reports that the Justice Department had launched a criminal investigation into Cook. The administration argued that the fraud allegations, first raised by Federal Housing Finance Agency Administrator Mark Pulte, constituted sufficient “cause” under U.S. law to remove Cook.
The department argued that the court lacked the authority to question Trump's reasoning for his dismissal. The filing stated, “His only 'evidence' is that the President criticized Fed policy. However, the existence of a policy disagreement does not justify the President's dismissal of Cook.”
*This is not investment advice.
