The Department of Justice will investigate Federal Reserve Governor Lisa Cook based on a criminal referral sent by a Trump administration housing official and arch critic of central bank chairman Jerome Powell, according to a letter obtained by CNBC’s Sara Eisen on Thursday.
The letter, addressed to Powell and signed by Justice Department attorney Ed Martin, urges the Fed chair to fire Cook from the board in light of the allegations that have been lodged against her.
“Do it today before it is too late!” Martin wrote.
But Powell does not have the authority to fire Cook.
The Federal Reserve Act of 1913 states explicitly that board members can only be removed by the president.
Moreover, the Supreme Court suggested earlier this year that the president does not have the authority to arbitrarily remove Fed governors over policy disagreements.
The DOJ declined CNBC’s request for comment on the letter. The Fed did not immediately respond to a request for comment.
Cook came under intense pressure to leave her post after Bill Pulte, director of the Federal Housing Finance Agency, on Wednesday morning accused her of possible mortgage fraud and urged the DOJ to launch a criminal probe.
Trump quickly demanded that Cook, who was appointed by former President Joe Biden in 2022, “must resign, now!!!“
Cook said Wednesday that she has “no intention of being bullied to step down from my position because of some questions raised in a tweet.”
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— CNBC’s Sara Eisen contributed to this report.
