President Trump is escalating pressure on a Federal Reserve governor, Lisa Cook, following allegations of mortgage fraud, demanding her immediate resignation and reportedly exploring options to remove her from the central bank’s board. 

Mr. Trump took to Truth Social Wednesday morning calling for Ms. Cook to “resign, now,” while behind the scenes he is investigating whether he can fire her, according to the Wall Street Journal. 

Ms. Cook is the first black woman to sit on the Fed’s powerful board that sets interest rates. A nominee of President Biden, she was confirmed in 2023 by a 51-50 vote of the Senate after Vice President Kamala Harris broke the tie. Republicans had accused Ms. Cook of being a left-wing extremist who supports reparations. She is in the second year of a 14-year term.

The president’s attack followed a letter from the Federal Housing Finance Agency director, Bill Pulte, to Attorney General Pam Bondi requesting an investigation into Ms. Cook for allegedly falsifying bank documents and property records to secure favorable loan terms.

Mr. Pulte, an heir to the Pulte Homes fortune, accuses Ms. Cook of designating two homes as her primary residence to receive lower mortgage rates. He claims that the Fed board member claimed in a June 2021 mortgage agreement for an Ann Arbor, Michigan, property that the home would be her primary residence for at least a year. Two weeks later, he alleges that she purchased a condominium at Atlanta that she also claimed would be her primary residence for a year. 

“How can this woman be in charge of interest rates if she is allegedly lying to help her own interest rates?” Mr. Pulte wrote on X, echoing Mr. Trump’s criticism.

The Department of Justice is investigating similar fraud claims against two prominent Democrats who are longtime political foes of Mr. Trump, Senator Adam Schiff of California and New York’s attorney general, Letitia James. Attorney General Pam Bondi has assigned a senior DOJ official, Ed Martin, as a special attorney for mortgage fraud, and he’s overseeing these investigations. He recently visited the block of a Brooklyn brownstone owned by Ms. James.

Ousting Ms. Cook would significantly shift the Federal Reserve’s composition, giving Mr. Trump the opportunity to appoint a new governor and tip the balance toward Republican appointees — creating a 4-3 majority among the Fed’s board members. All board members hold voting rights on the Federal Open Market Committee, the 12-person body that sets interest rates, alongside five regional Federal Reserve Bank presidents.

For months, Mr. Trump has been railing against the board’s chairman, Jerome Powell, for not lowering interest rates. On Tuesday on Truth Social, he called Mr. Powell “Too Late,” an epithet the president now frequently uses to demean the board chairman. Mr. Trump has said he won’t fire Mr. Powell, whose term ends in May, but he’s steadily ratcheting up the pressure, including embarrassing Mr. Powell about the high cost of renovations to the Fed’s D.C. headquarters by personally visiting the site.

Mr. Trump already gained an early opportunity to reshape the board this month when a Biden-appointed board member, Adriana Kugler, departed abruptly. The president nominated a White House economist and ally, Stephen Miran, to temporarily fill that seat while searching for a permanent nominee for the 14-year term.

However, Mr. Trump’s ability to remove Ms. Cook remains uncertain. Under the Federal Reserve Act of 1935, presidents can only dismiss Fed governors “for cause” — typically interpreted as dereliction of duty or malfeasance. The fraud allegations could potentially provide such grounds, though it would likely face legal challenges. 

It’s also unclear if Mr. Martin, the special attorney for mortgage fraud, will add Ms. Cook to his criminal investigation.

The controversy unfolds as markets await potential signals about September rate cuts from Mr. Powell, who will deliver his economic outlook Friday at the Jackson Hole symposium in Wyoming.  

Ms. Cook has consistently voted with Mr. Powell to hold interest rates steady — making her a target for the president’s broader Fed criticism.

Ms. Cook’s credentials and the quality of her scholarship were called into question by the Manhattan Institute’s Christopher Rufo in 2024. Mr. Rufo, in a report for City Journal, accused Ms. Cook of exhibiting “a pattern of careless scholarship at best or, at worst, academic misconduct.”