Washington — President Trump established a committee to look into allegations that Lisa Cook, a member of the Federal Reserve Board of Governors, made false statements on mortgage documents, the latest step in his renewed effort to fire Cook from her post with the central bank.
The president signed a memorandum, dated Wednesday, creating what he said is a “committee of inquiry” that will be made up of three members: the assistant to the president for economic policy, chair of the Equal Employment Opportunity Commission and head of the Office of Government Ethics.
After conducting its investigation into Cook, the committee will report to Mr. Trump whether there is “cause” to remove her from the Fed Board. The three-member panel will hold an in-person hearing at the White House on Nov. 5 to “consider the evidence and allegations” against Cook, according to the memorandum. The hearing will not be public, but will be transcribed, the White House said.
Cook has the opportunity to submit a “written position statement” to the committee in response to the accusations against her and can appear at the proceeding, the president’s memorandum stated.
“Governor Cook may present argument, written evidence, and written witness statements regarding the evidence and allegations,” it continued. “The Committee may also question Governor Cook about any representations she or her counsel make during the hearing, or it may authorize its representatives, including Department of Justice personnel, to conduct that questioning.”
Abbe Lowell and Norm Eisen, Cook’s lawyers, said she “welcomes the opportunity to present the facts so she can clear her name and demonstrate there is no legal basis to fire her.”
“In light of the President’s repeated statements that he has already decided to fire Governor Cook — regardless of the facts and evidence — we have grave doubts that this ‘hearing’ is a legitimate one that would conform to the law. But if it is anything close to objective, the conclusion will be that Governor Cook did not commit mortgage fraud, leaving no cause to remove her from the Federal Reserve Board,” they said in a statement. “We have engaged with the White House to evaluate whether the process proposed has a possibility of being a genuine one and not simply a box checking exercise.”
The president’s creation of the committee to investigate the claims against Cook appears to be the latest attempt by Mr. Trump to ensure any effort to fire her can stand up to legal scrutiny. The president first attempted to oust Cook from the Fed last year after a senior member of his administration, Bill Pulte, claimed she made false statements on mortgage documents related to two properties before she joined the central bank.
Cook challenged her removal, arguing that it violated federal law, which allows a president to remove a member of the Fed’s board “for cause.”
The Supreme Court ruled in June that Cook could continue serving in her post while her legal challenge to her purported removal continued. In a 5-4 decision, the high court found that Mr. Trump failed to provide Cook the procedural protections she was entitled to under the law — specifically notice and the opportunity to respond to the allegations before she was fired.
“That is not to say that a Federal Reserve Governor is entitled to an audience with the President or a fullblown judicial trial,” Chief Justice John Roberts wrote for the majority. “Instead, all that is required is notice ‘to the officer of the charges made against him’ and ‘an opportunity to be heard in his defense.'”
Roberts continued: “We see no reason why that opportunity ‘may not be had on written materials only,’ with no oral presentation. All that is required is ‘the right to support his allegations by argument however brief, and, if need be, by proof, however informal,’ before a final decision is made.”
Mr. Trump mounted another attempt to fire Cook after the Supreme Court ruled in her favor. In a letter to the Fed governor in August, the White House informed Cook that Mr. Trump was considering removing her because of the mortgage-fraud allegations and laid out the claims against her. The White House also set a deadline for Cook to respond.
Cook denied the accusations and argued in a response to the White House that she has “never committed mortgage fraud.” Lowell, Cook’s lawyer, said that attempting to remove her on the basis of the mortgage-fraud allegations would “ignore the facts and the law.”
