The Federal Reserve governor Lisa Cook faced more than $1.3m in legal and security fees after coming under attack from the Trump administration, according to ethics disclosures that were filed on Wednesday.
The White House targeted Cook last summer as Donald Trump ramped up his unprecedented campaign to push the Fed to cut interest rates.
Bill Pulte, the director of the Federal Housing Finance Agency who is set to become acting US intelligence chief on Friday, accused Cook of mortgage fraud. On social media, Pulte accused Cook of misleading lenders by listing a second home as her primary residence, which would get her a better mortgage rate.
Cook was appointed by Joe Biden in 2022, becoming the first Black woman to serve on the Federal Open Market Committee (FOMC). Her term is set to end in 2038.
Trump fired Cook from her role on the FOMC, where she was one of 12 voting members who set interest rates eight times a year.
Cook denied the accusations, accusing the administration of “cherrypicking” discrepancies to remove Cook for political reasons.
A federal court temporarily reinstated Cook, though her firing is still the center of a case before the US supreme court, which has yet to rule on whether the firing was legal. In a hearing in January, justices seemed skeptical over the brusque way Trump fired Cook.
The filing shows that two non-profit organizations, State Democracy Defenders Fund and Contina Impact reimbursed Cook for more than $1m for legal and security services.
The supreme court case will ultimately test how the high court views the Fed’s independence from the White House. Congress created the bank in 1913 with a unique structure that protects it from being influenced by politics, including not receiving funding from Congress and long terms for appointed officials.
The decision on Cook’s supreme court case, which is expected to be released before the end of June, will settle how much protection the Fed will have from the White House’s wrath.
Economists widely agree that an independent central bank uninfluenced by politics is essential for maintaining a stable economy. While past presidents have refrained from vocally criticizing the Fed, Trump in his second term has been unafraid of voicing his fury toward the Fed for not lowering interest rates.
While Trump’s new pick for Fed chair, Kevin Warsh, has aligned himself with the president, he still has only one of 12 votes on the Fed board. After their latest meeting on Wednesday, members of the board signalled a possible rate hike before the end of the year, likely to mitigate rising inflation that has jumped since the start of the Iran war.
