Photo: SAUL LOEB / AFP / Getty Images
The Justice Department has launched a criminal investigation into Federal Reserve Governor Lisa Cook over alleged mortgage fraud.
According to Bloomberg, federal prosecutors issued subpoenas related to allegations that Cook misrepresented information on mortgage applications, sources familiar with the matter said.
The investigation comes after Federal Housing Finance Agency Director Bill Pulte accused Cook of fraudulently identifying homes in Michigan and Georgia as “primary residences” to obtain more favorable mortgage terms in 2021.
Trump cited these allegations as he launched his efforts to fire Cook, saying in a letter that her “deceitful and potentially criminal conduct in a financial matter” gave him cause to terminate her.
Cook has denied any wrongdoing and is suing the Trump administration to keep her position, arguing that the president doesn't have the legal authority to remove her. Abby Lowell, Cook's attorney, said any discrepancies on mortgage documents were unintentional and not fraudulent.
“The questions over how Governor Cook described her properties from time to time, which we have started to address in the pending case and will continue to do so, are not fraud,” Lowell said on Thursday (September 4). “But it takes nothing for this DOJ to undertake a new politicized investigation, and they appear to have just done it again.”
In her lawsuit, Cook argues Trump’s effort to fire her represents a politically motivated power grab that could do “irreparable harm” to the U.S. economy. The Federal Reserve has agreed to abide by any court rulings that come from the case. Cook is currently seeking an emergency court order to remain in her post while her lawsuit moves forward.
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