Trump demands the resignation of Federal Reserve governor, while an associate petitions for Department of Justice investigation

In a dramatic turn of events, President Donald Trump has called for the resignation of Federal Reserve Governor Lisa Cook following a referral requesting an investigation into mortgage fraud allegations against her. The referral was submitted by Federal Housing and Finance Agency (FHFA) Director Bill Pulte.

Pulte has accused Cook of falsifying bank documents and property records, potentially committing mortgage fraud. According to Pulte, Cook allegedly claimed primary residence status for a pair of homes in Ann Arbor, Michigan, and Atlanta, Georgia, when obtaining mortgages on them 14 days apart. However, it's important to note that no concrete evidence of this has been made public, and the Federal Reserve has not yet commented on the allegations.

The allegations come at a critical time for the Federal Reserve, as it kicks off its annual monetary policy conference in Jackson Hole, Wyoming. Jerome Powell, the current chairman, has signaled his intention to serve out the remainder of his term, despite repeated calls from Trump for the Fed to cut interest rates.

Trump and his allies have also criticized the Federal Reserve's management of its headquarters renovation, suggesting it could serve as cause to remove Fed Chair Jerome Powell. However, legal questions about Trump's ability to fire Powell without cause have prevented him from doing so before May 2026.

Meanwhile, Jerome Powell is scheduled to deliver a speech on Friday morning that could provide insights into how the central bank views the latest economic data and the path for potential interest rate cuts. The speech is eagerly anticipated as it could offer some clarity amidst the ongoing controversy surrounding Cook.

Interviews for potential Federal Reserve chairs are expected to start around Labor Day, according to Treasury's Bessent. As the investigation into Cook's alleged actions continues, the future of the Federal Reserve and its leadership remains uncertain.

In a statement on July 11, Pulte suggested that Jerome Powell might be considering resigning, writing that "I'm encouraged by reports that Jerome Powell is considering resigning." However, there has been no official confirmation of this from Powell or the Federal Reserve.

As the situation unfolds, the public awaits further developments in this high-stakes drama involving one of the most influential institutions in the American economy.