Catholic University America law professor Chad Squitieri discusses President Donald Trump revoking former Vice President Kamala Harris’ Secret Service detail and Federal Reserve Board of Governors member Lisa Cook’s legal action after ousting.
The Justice Department has formally opened a criminal investigation into Federal Reserve Board Governor Lisa Cook as part of an effort to determine whether she submitted fraudulent information on mortgage applications, Fox News has learned.
The Justice Department investigation comes just days after Cook filed a lawsuit challenging President Donald Trump’s attempt to fire her from the panel of central bankers that is tasked with charting the nation’s economic path.
The fraud allegations Trump cited in his move to fire her were first leveled by Bill Pulte, a Trump appointee to the Federal Housing Finance Agency (FHFA), the federal agency that regulates Fannie Mae and Freddie Mac.
COOK’S LAWSUIT AGAINST TRUMP SETS UP A POTENTIAL SUPREME COURT CLASH
President Donald Trump tried to fire Fed governor Lisa Cook, but she is refusing to step down. (Al Drago/Bloomberg via Getty Images; Allison Robbert/Bloomberg via Getty Images / Getty Images)
Pulte linked Cook in two separate referrals to the Justice Department to a trio of mortgages she took out before she joined the nation’s central bank.
The loans, tied to properties in Michigan, Georgia, and Massachusetts, prompted scrutiny over whether Cook had misrepresented how the homes would be used. Trump seized on those allegations in his bid to oust her from her role as a Federal Reserve governor.
The criminal investigation opened by the DOJ could further complicate Cook’s fight to stay in her role on the Fed board.
FEDERAL RESERVE GOVERNOR LISA COOK SUES TRUMP
Attorney Abbe Lowell outside the U.S. Capitol on December 13, 2023 in Washington. (Drew Angerer/Getty Images / Getty Images)
One major argument Cook’s lawyers made in court on Friday was the lack of a formal Justice Department investigation, which they cited as evidence that the allegations against her were unsubstantiated.
Cook’s lawsuit argues that Trump’s move to fire her is unlawful and undermines the Federal Reserve’s independence. The lawsuit, which was filed in federal court on Aug. 28, does not address why Cook listed two houses as a primary residence on mortgage filings.
Her lawyer, Abbe Lowell, wrote in a filing on Sept. 2 that she “did not ever commit mortgage fraud.
Attorneys representing Cook sparred with Justice Department lawyers Friday over the nature of the probe, and whether Trump as commander-in-chief had the “cause” needed to oust her from the board.
Lowell, noted on several occasions that there was no “investigation or charge” from the administration prior to Trump’s abrupt announcement that he would fire Cook.
He also vehemently disputed the Justice Department’s allegations that Cook had an “opportunity” to respond to the mortgage fraud accusations leveled by Pulte, which he noted were made just 30 minutes before Trump called for Cook to be removed.
Lowell argued that it was merely an attempt by the administration to “litigate by tweet.”
CLICK HERE TO GET BUSINESS ON THE GO
The White House referred queries to the Department of Justice. The Federal Reserve declined to comment.
Before Cook filed her suit, a Fed spokesperson acknowledged the potential legal feud and wrote in an Aug. 26 statement that the Fed will “abide by any court decision.”
Fox News Digital’s Ashley Oliver, Jake Gibson and David Spunt contributed to this report.
This is a developing story. Please check back for updates.
