Trump has established a committee to investigate whether Lisa Cook should be dismissed, with the hearing scheduled for November 5. However, she is expected to participate in the Federal Reserve's interest rate vote on October 28, and the committee does not have the authority to directly remove her.

Source: Jin Shi Data

U.S. President Trump announced last Friday the formation of a special committee to investigate whether there are grounds to dismiss Federal Reserve Governor Lisa Cook. This is Trump's attempt to push for Cook's departure again after his previous dismissal action was blocked by the Supreme Court.

Trump had previously accused Cook of mortgage fraud and ordered her dismissal in 2025. The Supreme Court blocked this action on procedural grounds but indicated that the president could try again. In August of this year, Trump notified Cook that he was considering restarting the dismissal process; Cook's lawyer later denied the fraud allegations and stated that there was no legal basis for her dismissal.

The newly formed committee will hear statements from both sides and provide recommendations to Trump, but it does not have the power to directly decide whether Cook should leave. The debate over the legality of the hearing process, whether Cook must answer questions that could involve criminal liability, and whether the president's final decision can withstand judicial review will continue.

Three Trump-appointed officials will preside over the hearing, with the final decision still resting with the president

According to a presidential memorandum signed by Trump, Cook is expected to attend the hearing at the White House on November 5, with the possibility of being accompanied by a lawyer. The committee will assess the evidence against her and her responses; she can submit a follow-up statement by November 10.

The committee is composed of three members: Kevin Hassett, Director of the National Economic Council; Keith Sonderling, Acting Director of the Office of Government Ethics and a Labor Department official; and Andrea R. Lucas, Chair of the Equal Employment Opportunity Commission. All three were appointed by Trump.

The committee will make recommendations to the president on whether there are sufficient grounds to dismiss Cook. Trump is not required to make a final decision within a fixed timeframe.

This arrangement is not the first of its kind in U.S. history. Chief Justice John Roberts referenced a precedent from 1912 in the majority opinion of "Trump v. Cook." At that time, President William Howard Taft convened an investigative committee to consider the dismissal of two members of the General Appraisal Board. This board is the predecessor of today's U.S. International Trade Court and ultimately recommended the dismissal of the two members.

However, the Supreme Court did not require Trump to follow this precedent. Roberts noted that Cook has the right to know the reasons behind the president's decision, the relevant evidence, and to have an opportunity to defend herself, but she does not "have the right to meet with the president or to undergo a full judicial trial." He also stated that the relevant procedures could be conducted entirely in writing.

The new committee consists of executive branch officials reporting to the president and is not an independent judiciary body. Although members are required to hear Cook’s explanations, their duty is to provide recommendations to Trump rather than to make independent judicial judgments.

Cook's lawyers question the legality of the proceedings, and the scope of testimonies becomes a new controversy

Cook's lawyers, Abbe Lowell and Norm Eisen, stated in a release that Cook "welcomes the opportunity to state the facts in order to clear her name and prove there is no legal basis for her dismissal." However, they also stated that they "seriously doubt the legality of this 'hearing' and whether it complies with the law."

Cook has consistently denied the mortgage fraud allegations. The committee does not need to find her guilty of a crime, only to assess whether Trump has sufficient grounds to dismiss her.

The Supreme Court has not previously defined what constitutes sufficient grounds for the dismissal of a Federal Reserve governor. Roberts noted that this determination at least partly depends on the severity of the alleged misconduct and the connection between the relevant behavior and the governor's professional duties. If Trump ultimately decides to dismiss Cook, this legal standard is likely to become the focal point of subsequent litigation.

The hearing also involves potential criminal risks. The presidential memorandum requires Cook's attendance and allows Justice Department officials to question her, but it does not specify whether her answers can be used in future criminal cases.

The Fifth Amendment of the U.S. Constitution typically protects government employees from having statements made under the pressure of losing their jobs being used for criminal prosecution. However, it is unclear whether Cook's testimony in this process would be deemed compelled in a legal sense.

As such, Cook's lawyers may request the government to clarify the scope of testimony usage and seek relevant assurances before she answers questions that might expose her to criminal liability. Invoking the Fifth Amendment or requesting immunity for testimony does not legally equate to admitting guilt, but Trump may interpret it differently on a political level.

Even if the committee recommends dismissing Cook, it does not necessarily mean she will leave. The Supreme Court has previously affirmed that courts have the authority to review the president’s determinations of dismissal grounds. If Trump orders her dismissal again, the related controversy is likely to reenter the judicial process, potentially prolonging the entire process for months.

Cook can still participate in Federal Reserve votes, Powell's tenure is not directly affected

The establishment of the committee will not immediately change the Federal Reserve's interest rate decisions. Cook is still expected to participate in the Federal Reserve's interest rate vote on October 28. After the Supreme Court blocked Trump's attempt to dismiss her, she continues to serve as a formal member of the Federal Reserve; during the committee's investigation and any potential judicial challenges, she is likely to continue in her role.

Trump's decision to establish the committee will also not directly affect former Federal Reserve Chair Jerome Powell's position on the board. Powell's term as chair ended in May, but he can continue to serve as a voting member of the Federal Reserve until January 2028.

In the past, it was common for Federal Reserve chairs to resign from their board positions after their chair terms ended, but Powell indicated in March this year that he wishes to continue serving in order to "see the conclusion of another investigation concerning himself in a transparent and conclusive manner." That investigation concluded two weeks ago without any criminal charges, and the Justice Department has indicated it will not pursue further. Powell has not yet commented on Cook's situation following the Supreme Court ruling.

The White House has also previously criticized another Federal Reserve Governor, Michael Barr, for his role as the highest banking regulator during the 2023 Silicon Valley Bank collapse. However, the White House did not call for Barr to resign.

The Federal Reserve has referred questions regarding the new committee to Cook's lawyers. Federal Reserve Chair Kevin Warsh previously stated that the Federal Reserve will adhere to the Supreme Court's ruling.

Currently, whether the committee can provide Trump with sufficient legal grounds to dismiss Cook remains to be determined through the hearing and subsequent decisions. Even if Trump ultimately orders her removal, whether the court will accept his reasoning will also determine whether this dispute can truly come to an end.