Trump demands Supreme Court let him fire Fed Governor Lisa Cook

Donald Trump has asked the Supreme Court to throw out two court decisions that are stopping him from removing Federal Reserve Governor Lisa Cook, according to a Thursday filing by the Justice Department.

This came just one day after Lisa sat in on the Federal Open Market Committee meeting, where the Fed voted to cut the benchmark overnight rate by 0.25%. Cryptopolitan reported.

Trump announced on August 25 that he was firing Lisa from her role on the seven-member Fed board, accusing her of mortgage fraud involving two properties she owns in Michigan and Georgia.

Trump claimed Lisa made conflicting statements in two different mortgage applications, declaring both homes to be her primary residence. He argued that this conduct was both deceitful and potentially criminal, and he believed it showed a clear lack of fitness to serve on the board of the U.S. central bank.

Federal judge blocks Trump as Cook sues to keep seat

Lisa denied the allegations and sued Trump, saying he had no legal grounds to remove her. On September 9, a federal judge in Washington, D.C. ruled in her favor, for now. The judge issued a preliminary injunction that barred Trump from firing her while the lawsuit goes through the courts.

The Justice Department tried to get around that order by going to the D.C. Circuit Court of Appeals, asking a three-judge panel to block the ruling before the Fed met to decide rates.

But on Monday night, the appeals court said no. In a 2-1 decision, the panel refused to pause the injunction, which meant Lisa was allowed to join the Fed’s internal meeting and vote.

Solicitor General D. John Sauer, who wrote the Supreme Court application, said Trump was being blocked from using powers that belong to the presidency.

“This application involves yet another case of improper judicial interference with the President’s removal authority – here, interference with the President’s authority to remove members of the Federal Reserve Board of Governors for cause,” Sauer wrote.

Sauer argued that Lisa has no Fifth Amendment property interest in staying on the Fed board and that her job isn’t protected by due process. He also rejected the judge’s view that Trump’s justification was invalid because the alleged misconduct happened before she was appointed.

“The Federal Reserve Act’s broad ‘for cause’ provision rules out removal for no reason at all, or for policy disagreement,” Sauer said. “But so long as the President identifies a cause, the determination of ‘some cause relating to the conduct, ability, fitness, or competence of the officer’ is within the President’s unreviewable discretion.”

Justice Department says reinstatement overstepped judicial power

The filing claims Lisa misled mortgage lenders on both properties. Sauer wrote, “Cook had made contradictory representations in two mortgage agreements a short time apart, claiming that both a property in Michigan and a property in Georgia would simultaneously serve as her principal residence.”

He added that the agreements described the declarations as material to the lender, because mortgages for a primary home usually come with lower interest rates due to reduced risk.

Sauer said that when Trump found out about the issue, he decided Lisa’s “deceitful and potentially criminal conduct in a financial matter” showed she was “unfit to continue serving on the Federal Reserve Board,” and that her actions were at least “the sort of gross negligence in financial transactions that calls into question [her] competence and trustworthiness as a financial regulator.”

He also slammed the district court’s move to reinstate Lisa to the Fed board. “The district court judge lacked authority to order reinstatement as an equitable remedy for the removal of an officer of the United States, as we have discussed in several recent stay applications,” Sauer wrote. The Justice Department is now asking the Supreme Court to wipe out the lower court’s ruling and let Trump fire Lisa immediately.

If the court agrees with Trump, he’ll have picked four out of the seven current Fed governors. That number includes Stephen Miran, who was confirmed by the Senate on Tuesday.

Stephen was a senior official at the White House Council of Economic Advisors, and Trump nominated him to replace Adriana Kugler, who resigned in August without giving a reason. Stephen has already taken his seat, as he joined this week’s FOMC meeting with Lisa.

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