D.C. Appeals Court Allows Lisa Cook To Participate in Upcoming Fed Meeting, Saying Trump Gave Her No ‘Process’ To Refute Mortgage Fraud Allegations

A federal appeals court at Washington, D.C., has blocked President Trump’s attempt to fire a Federal Reserve governor, Lisa Cook, saying that the president gave her no “process” to refute allegations that she committed mortgage fraud, which was the “cause” that Mr. Trump cited in trying to remove her. She will now participate in the Fed meeting to set interest rates, which begins on Tuesday. Ms. Cook sued Mr. Trump in August after he tried to remove her from the central bank’s board of governors. A district court judge ruled that he did not have the power to do so, and on Monday night, the U.S. Court of Appeals for the District of Columbia Circuit affirmed that decision. Ms. Cook prevailed in her preliminary ruling before a panel of three judges — two of whom were nominated by President Biden and one of whom was nominated by Mr. Trump. The Republican appointee was the lone vote to allow the president to remove Ms. Cook as the appeals process plays out. “In this court, the government does not dispute that it failed to provide Cook even minimal process — that is, notice of the allegation against her and a meaningful opportunity to respond — before she was purportedly removed,” Judge Brad Garcia, who joined the court in 2023, wrote in the majority opinion. He was joined by Judge J. Michelle Childs, who was nominated to the bench by Mr. Biden in 2021. “The district court thus preliminarily enjoined Cook’s removal based, in part, on its conclusion that her removal likely violated the Fifth Amendment’s Due Process Clause. That conclusion is correct,” Judge Garcia writes. The Trump administration asked the court on an emergency basis to keep Ms. Cook off of the board of governors as the appeals process moves forward. Had the government succeeded, she would have been barred from participating in the Federal Open Market Committee meeting, which begins Tuesday. Members are expected to vote to cut interest rates following that gathering, though experts are debating to what extent they will do so. The lone dissenting jurist, Judge Gregory Katsas, was confirmed to a seat on the appellate bench during Mr. Trump’s first term. He writes that the president is within his authority to fire Ms. Cook “for cause” following the allegations of mortgage fraud because such a crime is a felony offense. “The President plainly invoked a cause relating to Cook’s conduct, ability, fitness, or competence. The allegations against Cook could constitute mortgage fraud if she acted knowingly, and that is a felony offense,” Judge Katsas writes. “Moreover, even absent intentional misconduct, any misstatements in formal applications for six-figure loans are at least concerning.”

D.C. Appeals Court Allows Lisa Cook To Participate in Upcoming Fed Meeting, Saying Trump Gave Her No ‘Process’ To Refute Mortgage Fraud Allegations

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