By Howard Schneider and Ann Saphir
(Reuters) -Federal Reserve Governor Lisa Cook, whose removal is being sought by President Donald Trump over allegations of misstatements on her mortgages, will seek court approval for her continued ability to serve in her role at the U.S. central bank, the Fed said in a statement Tuesday.
Though Trump on Monday said Cook’s firing was “effective immediately,” the Fed’s statement indicates that from the U.S. central bank’s view, Cook’s status as a governor has not changed, absent a court finding of some sort.
Her lawyer Abbe Lowell has pledged to file litigation on her behalf against the firing. The Justice Department has not filed charges or taken any steps against her.
“Lisa Cook has indicated through her personal attorney that she will promptly challenge this action in court and seek a judicial decision that would confirm her ability to continue to fulfill her responsibilities as a Senate-confirmed member of the Board of Governors of the Federal Reserve System,” a Fed spokesperson said. “As always, the Federal Reserve will abide by any court decision.”
The Federal Reserve Act sets 14-year terms for Fed governors and specifies that they may be removed by the president only for “cause.”
“Long tenures and removal protections for governors serve as a vital safeguard, ensuring that monetary policy decisions are based on data, economic analysis, and the long-term interests of the American people,” the Fed spokesperson said. “The Federal Reserve will continue to carry out its duties as established by law.”
The Fed next meets to set interest rates on September 16-17, and a court ruling could settle whether Cook can participate in the decision.
(Reporting by Ann Saphir, Editing by Franklin Paul and Chizu Nomiyama )
