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On August 20, U.S. Federal Housing Finance Agency Director William Pulte, appointed by Trump, accused Cook of claiming two of her mortgages in Michigan and Georgia as primary residences. The Department of Justice was investigating the matter when President Trump called on Cook to resign. In a letter posted on his Truth Social platform, Trump stated that there was sufficient cause to remove Cook from her position due to false statements on mortgage applications.
Cook had been defiant about leaving the Federal Reserve, saying she “intend[ed] to take any questions about my financial history seriously as a member of the Federal Reserve” and would gather accurate information. Cook took out the mortgages in 2021 while an academic; an official financial disclosure form listed three mortgages, with two as personal residences.
Pulte claimed Cook committed mortgage fraud by listing two of her mortgages as primary residences but provided no public evidence. Pulte’s accusations coincided with broader efforts by the Trump administration to challenge diversity, equity, and inclusion programs in government, leading to departures of some prominent women and minorities.
The firing marked an escalation in Trump’s attempt to reshape the Federal Reserve leadership ranks, pressuring them for aggressive rate cuts despite Fed officials maintaining steady rates amid inflation concerns. Trump has threatened to fire Fed Chair Jerome Powell but backed away as Powell’s term nears expiration next May.
Cook’s exit from the Fed could expedite the president’s reshaping of the central bank. He recently elevated Fed Governor Michelle Bowman as top bank regulator and is considering appointing Fed Governor Christopher Waller, whom he named in 2020, to succeed Powell. Two other Biden appointees on the Fed board have time left in their terms, while Powell could remain until 2028.
Financial issues have been a regular issue for U.S. central bank officials. In 2021, presidents of the Dallas and Boston Federal Reserve banks resigned due to active trading revelations but were later cleared by the Fed’s watchdog. The Inspector General said their trading created an appearance of conflict of interest, leading the Fed to tighten ethics rules governing officials’ personal investing.
Reporting by Michael S. Derby; Additional Reporting by Kanishka Singh; Editing by Paul Simao, Caitlin Webber, and Lincoln Feast.
