WASHINGTON — President Trump’s Justice Department petitioned the Supreme Court Thursday to give him the go-ahead to fire embattled Federal Reserve Governor Lisa Cook after two lower courts blocked her ouster.
Solicitor General D. John Sauer argued that the lower court ruling keeping Cook on the central bank amounted to “improper judicial interference” and should be overturned.
“This application involves yet another case of improper judicial interference with the President’s removal authority,” Sauer wrote in the filing. “The government is likely to succeed on the merits because Cook lacks a Fifth Amendment property interest in her continued service as a Governor of the Federal Reserve.”
“The President’s strong concerns about the appearance of mortgage fraud, based on facially contradictory representations made to obtain mortgages by someone whose job is to set interest rates that affect Americans’ mortgages, satisfy any conception of cause,” Sauer added.
Trump had moved to fire Cook, a Biden appointee, on Aug. 25 following allegations by Federal Housing Finance Agency Director Bill Pulte that she committed fraud on applications for her personal home mortgages.
Under the Federal Reserve Act, Fed governors can be fired for “cause.”
Cook, who has yet to be charged with any crime, sued the administration, arguing her paperwork snafu did not meet the statutory requirement for “cause.”
Last week, a federal judge temporarily blocked her firing while litigation plays out, finding the Fed official was likely to prevail and did not receive due process.
A divided DC appeals court panel upheld the lower court ruling, leading to Sauer’s Thursday appeal.
Cook participated in the Fed’s Wednesday decision to cut its benchmark interest rate target by 25 basis points, the first such reduction since December.
She was among the governors who voted in favor of the cut amid evidence of a softening labor market. Trump’s newest appointee to the Fed, Stephen Miran, had been the only dissenter, having wanted the central bank to slash rates by 50 basis points.
Fed Chair Jerome Powell has defended the central bank’s caution with interest rates, arguing that uncertainty over potentially inflationary effects from Trump’s tariffs had prompted it to keep rates steady.
Trump has demanded for months that the Fed lower rates as his administration works to refinance a huge chunk of the national debt.
His attempted firing of Cook — the first such action by a president — was widely seen as part of his effort to reshape the central bank
