The Ministry of Justice began to examine the allegations of mortgage fraud against Lisa Cook, the governor of the federal reserve who challenges a Trump administration effort to withdraw it from his work in a decision which, according to her, is designed to erode the independence of the Central Bank.
The investigators issued assignments as part of a Cook investigation which was generated by a criminal reference to the best housing regulator in the country, according to a person familiar with the question which was not allowed to discuss the investigation and spoke under the cover of anonymity to the Associated Press.
A spokesman for the Ministry of Justice refused to comment on the investigation, which was previously reported by the Wall Street Journal.
“Predictibly and recognizing the faults of contesting their illegal dismissal from Governor Cook, the administration rushes to invent new justifications for its excessive department. This Ministry of Justice – perhaps the most politicized in American history – will do everything that President Trump demands,” said Cook’s lawyer, Abbe David Lowell.
The news of the survey comes in the midst of a legal struggle with high issues on the announcement of President Donald Trump last month that he was moving Cook, an action which, according to her, is undertaken so that he can take control of a central bank which is generally protected from political pressure and responsible for making decisions on the advisability of increasing or lowering interest rates.
Trump moved to Fire Cook on August 25 after one of her named people alleged that she had committed mortgage fraud linked to two properties she had bought in 2021, before joining the Fed.
Bill Pulte, who made the criminal reference in his capacity as director of the Federal Housing Finance Agency, said that Cook had claimed two main residences, in Ann Arbor, Michigan and Atlanta, in 2021 to obtain better mortgage conditions. Mortgage rates are often higher in second homes or those purchased for rent.
The investigation of the Ministry of Justice is focused on these two properties, according to the person familiar with the issue. He is coordinated with the offices of American lawyers by Ed Martin, director of the working group on the armament of the Ministry of Justice, who also pursues surveys on mortgage fraud on opponents perceived of Trump, notably the Senator Adam Schiff of California and the Attorney General of New York Letitia James, both Democrats. The two vigorously denied any reprehensible act.
Pulte dodged questions in a CNBC interview on Thursday to find out if he also examined Ken Paxton, the Attorney General of Texas who is friendly with Trump and presents himself to the Senate in the republican primary of his state. Paxton contracted mortgages on three properties that have all been identified as his main residence. He said he would not comment on any specific situation that was not made public.
Cook’s lawyers also insisted that it did not engage in fraud.
“The questions about how Governor Cook described his properties from time to time, which we have started to approach in the pending case and will continue to do so, are not fraud, but this Doj is not necessary to undertake a new politicized investigation, and they seem to have done it again,” said Lowell.
Furthermore, Thursday, the Ministry of Justice urged a federal judge to Washington to allow the immediate withdrawal of Cook while it fights to keep its job, rejecting as an assertion of Cook “without foundation” according to which the president tries to dismiss her so that he can take control of the federal reserve.
Cook’s lawyers argued that the dismissal was illegal because the presidents can only draw “for cause” governors, which has generally meant the ineffectiveness, the negligence of duty or embezzlement during its functions. They also said that she was entitled to an hearing and a chance to respond to the accusations before being dismissed, but that she was not provided either. Lawyers said that in the court deposited that Cook had never committed mortgage fraud.
The Ministry of Justice says that the president has the discretion of drawing Cook because and that his decisions cannot be examined by the courts.
The case could become a turning point for the almost 112 -year -old federal reserve, which was designed by the congress to be isolated from daily political influence. Economists prefer independent central banks because they can do unpopular things, such as interest rates to combat inflation more easily than elected officials.
Trump has repeatedly attacked the president of the Fed, Jerome Powell, and the other members of the Fed interest rate adjustment committee for not having reduced the short -term interest rate that they control more quickly.
Many economists fear that if the Fed falls under the control of the White House, it will maintain its key interest rate lower than justified by the economic fundamentals to meet the requests of cheaper borrowing Trump.
