The Department of Justice has opened a criminal investigation into the real estate shenanigans of Federal Reserve Governor Lisa Cook.
The saga starts with Cook's purchase of two properties, one in Ann Arbor, Michigan, and one in Atlanta, Georgia, within two weeks of each other, and declaring, under oath of perjury, that both were her primary residence. The whistle was blown on that scam by Bill Pulte, the director of the Federal Housing Finance Agency, who has filed three criminal referrals against her.
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The matter might have dropped if Cook had gone away quietly after being terminated. But now that the Department of Justice has gotten involved, they will want a scalp to justify their work. This case has now advanced to the stage of the Department of Justice issuing subpoenas. Hopefully, the 6 a.m. visit by the FBI SWAT team with the same shoot-to-kill orders that were used against President Trump will take place very soon.
I think other shoes are waiting to drop. Pulte had scheduled a press conference at the federal courthouse in D.C. on Thursday morning. He cancelled it on Wednesday afternoon, "out of respect for the process."
President Trump used the allegations of perjury and fraud as a reason to fire her "for cause," but she is contesting the matter in court. The one thing missing from Cook's argument is any denial of the facts; see Scott Bessent Notes the One Key Thing Fired Fed Reserve Governor Lisa Cook Has Not Said – RedState. The lack of a denial figured prominently in her court hearing.
In a court filing on Thursday, Justice Department lawyers pushed back on Cook’s claim that the alleged inconsistencies on her mortgage filings were known before she was appointed. They also said that even if Trump had given Cook a chance to argue against her firing, it wouldn’t have made a difference: “An opportunity to tell one’s side of the story only matters if one has a side of the story to tell, and Dr. Cook has given no indication that she does,” they wrote.
The next meeting of the Federal Reserve Board of Governors is September 16, at which it is widely anticipated that the Fed will reduce interest rates; see Fed Chairman Hints at Coming Interest Rate Cut and Swears He's Not Doing It Because of Trump – RedState.
This poses a problem for Fed Chairman Jerome Powell, who is already on thin ice with President Trump. He needs to act to suspend Cook's voting rights pending the outcome of her legal case. If she votes on the rate decision and is inevitably determined to have been fired, then that and any other decision she's taken part in have questionable legality. If he does not prevent her from voting, then his refusal to honor President Trump's order firing Cook could be used to fire him "for cause."
If Cook's firing sticks, and I think it will in the long run, then Trump will have a majority on the seven-member board and more clout over the nation's economic policy.
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