Washington, United States: The U.S. Supreme Court blocked President Donald Trump’s attempt to remove Federal Reserve Governor Lisa Cook, according to The Wall Street Journal.
The court upheld lower-court rulings that temporarily prevented Cook’s dismissal, allowing her to remain on the Federal Reserve Board of Governors while the case proceeds.
The Wall Street Journal said a ruling in favour of the administration could have expanded presidential authority to remove Federal Reserve governors without judicial scrutiny.
Federal law allows a president to remove a Federal Reserve Board member only for cause. Trump’s appeal centred on what qualifies as cause, who determines it and what legal protections apply.
Trump argued he had broad authority to dismiss Cook after Federal Housing Finance Agency Director Bill Pulte raised mortgage-fraud allegations against her.
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The president alleged that Cook listed a second home as her primary residence on a mortgage application to obtain more favourable loan terms.
The Justice Department has opened a criminal investigation into the allegations.
Cook has not been charged with any offence and has declined to step down. Her lawyers said the case rests on a single reference in a 2021 mortgage document and called it a pretext for a politically driven attempt to influence the Federal Reserve’s policymaking body.
