The Department of Justice (DOJ) has launched a criminal investigation into Federal Reserve governor Lisa Cook, marking a dramatic escalation in the ongoing battle between President Donald Trump’s administration and the nation’s central bank. The probe, which became public on September 4, 2025, centers on allegations that Cook submitted fraudulent information on mortgage applications related to her properties in Ann Arbor, Michigan, and Atlanta, Georgia. The investigation comes at a moment of heightened tension, with President Trump having recently attempted to fire Cook—a move without precedent in the more than 100-year history of the Federal Reserve Board.
According to The Associated Press and The Wall Street Journal, DOJ investigators have already issued subpoenas and convened grand juries as part of their inquiry. The allegations were first raised by Bill Pulte, the Federal Housing Finance Agency Director and a top mortgage official under Trump. Pulte claims that Cook declared both her Ann Arbor home and Atlanta condo as her primary residence within two weeks of purchasing each property. A review by CNN confirmed that mortgage documents listed both as primary residences, but it remains unclear whether this was intentional or simply an administrative oversight.
In late August, President Trump announced that he had fired Cook from the Federal Reserve Board, citing the mortgage fraud allegations. If upheld, this would be the first time a sitting president has removed a Fed governor. Cook, however, refused to step down, immediately filing a lawsuit to challenge the removal and arguing that the president lacks the authority to fire members of the independent central bank. She also asked the court to allow her to remain in her post while the litigation proceeds. As Cook’s legal team noted in court filings this week, the stakes are enormous—not just for Cook herself, but for the independence of the Federal Reserve and the limits of presidential power.
Cook’s lawyer, Abbe Lowell, has forcefully rejected the allegations and characterized the DOJ investigation as politically motivated. In a statement to ABC News on September 4, Lowell declared, “Predictably and recognizing the flaws in challenging their illegal firing of Governor Cook, the administration is scrambling to invent new justifications for its overreach. This Justice Department—perhaps the most politicized in American history—will do whatever President Trump demands. He wants cover, and they are providing it.” Lowell reiterated, “The questions over how Governor Cook described her properties from time to time, which we have started to address in the pending case and will continue to do so, are not fraud, but it takes nothing for this DOJ to undertake a new politicized investigation, and they appear to have just done it again.”
The DOJ’s investigation was instigated by Ed Martin, a Trump loyalist appointed by Attorney General Pam Bondi in August 2025 to oversee mortgage fraud probes into several prominent Democrats, including Cook, New York State Attorney General Letitia James, and Senator Adam B. Schiff. According to The Times, Martin is described as a “hyperpartisan Trump loyalist with little prosecutorial experience.” His appointment has drawn criticism, particularly given his recent history of firing or demoting attorneys involved in January 6 insurrection prosecutions and dismissing charges against accused insurrectionists—sometimes those he personally represented.
Martin made headlines again in late August when he sent a letter to Federal Reserve Chair Jerome Powell, urging him to remove Cook from the Board. However, as Bloomberg reported, Powell does not possess the authority to remove fellow governors, such as Cook. This fact underscores the unusual and contentious nature of the administration’s campaign against her.
Lisa Cook, who was nominated by then-President Joe Biden and confirmed in 2023, is the first Black woman to serve on the Federal Reserve Board. Her term is set to run through 2038. The investigation and her legal battle with the White House are unfolding against a backdrop of persistent tension between Trump and the Federal Reserve. Throughout 2025, Trump and his officials—including Pulte and Treasury Secretary Scott Bessent—have publicly pressured the central bank to slash interest rates, arguing it would stimulate the economy. Trump’s frustration has been palpable, especially as the Fed, led by Chair Jerome Powell, has resisted calls for dramatic rate cuts, opting instead for a cautious approach to avoid fueling inflation.
At a cabinet meeting held just hours after he attempted to fire Cook, Trump told reporters, “We’ll have a majority very shortly,” referring to the Federal Reserve Board, and added that it would be “great.” Critics interpret these remarks as evidence of a broader strategy to reshape the central bank’s leadership in line with Trump’s economic agenda. The timing of the DOJ’s investigation, coupled with the president’s public statements, has fueled accusations from Cook’s supporters and outside observers that the administration is weaponizing federal law enforcement to silence or intimidate perceived adversaries.
The legal and political implications of Cook’s case are far-reaching. No president has ever fired a Federal Reserve Board member, and the Board’s independence is widely regarded as a cornerstone of the U.S. financial system. Cook’s lawsuit, which challenges the constitutionality of her removal, could set a precedent that shapes the balance of power between the executive branch and the central bank for years to come.
Meanwhile, the Federal Reserve is set to meet on September 16-17, with expectations mounting that it will cut interest rates—the very issue at the heart of Trump’s months-long campaign against the central bank. As the legal drama unfolds, the outcome of both the investigation and Cook’s lawsuit could have a profound impact not only on her own career but also on the future of U.S. monetary policy.
For now, Cook remains on the Board, fighting on two fronts: defending herself against criminal allegations she denies, and challenging what she and her allies describe as an unprecedented assault on the Fed’s independence. The coming weeks promise to be pivotal, with ramifications that could extend far beyond the walls of the central bank.
