Trump renews bid to fire Federal Reserve governor

• The Supreme Court ruled 5-4 in June against Trump's first attempt to fire Cook, with Chief Justice Roberts stating Trump failed to provide proper procedural protections required by statute
• The White House letter alleges crimes that could carry a 30-year prison sentence, but Cook's lawyer says there is 'no valid cause' for removal and will challenge any dismissal attempt
• Trump's new Fed Chair Kevin Warsh took over in May 2026, but interest rates have remained unchanged despite presidential pressure on the Fed board, where Biden appointees hold the majority

Summary

President Donald Trump is making a second attempt to remove Federal Reserve Governor Lisa Cook, following a Supreme Court ruling in June that blocked his initial effort. In a letter this week, the White House informed Cook the president is "considering" her removal and demanded she respond within three weeks to mortgage fraud allegations, which her lawyer Abbe Lowell called "baseless."

Key Details:

• The letter, signed by Deputy Chief of Staff Dan Scavino, alleges Cook committed crimes potentially warranting a 30-year prison sentence
• Cook, the first Black woman to serve as Fed governor, previously denied these allegations, calling them a pretext for removal over monetary policy disagreements
• The Supreme Court blocked Trump's first attempt in a 5-4 ruling in June, with Chief Justice John Roberts stating Trump failed to provide Cook proper procedural protections
• No president since the Federal Reserve's founding in 1913 has attempted to fire a Fed governor

Market Implications:

This marks Trump's second attempt this week to challenge Supreme Court decisions, including another effort to limit birthright citizenship. The renewed pressure on the Fed raises concerns about central bank independence, particularly as Trump has previously threatened former Chair Jerome Powell over interest rate policies. His successor, Kevin Warsh, took over in May, though interest rates have remained unchanged despite presidential pressure.

Cook's legal team indicated they will challenge any removal attempt. The Federal Reserve and White House did not respond to requests for comment. The case has been returned to lower courts for further proceedings.