Lisa Cook, the Federal Reserve governor who was notified by President Donald Trump on Monday that he intends to fire her for alleged mortgage fraud, is taking legal action to keep her position at the world’s most powerful central bank.

“President Trump has no authority to remove Federal Reserve Governor Lisa Cook,” her attorney, Abbe David Lowell of Lowell & Associates, said in a statement sent to Scotsman Guide on Tuesday. “His attempt to fire her, based solely on a referral letter, lacks any factual or legal basis. We will be filing a lawsuit challenging this illegal action.”

In a move that has no legal precedent in the Federal Reserve’s 112-year history, Trump deemed there was “sufficient cause” to remove Cook from office based on information contained in a criminal referral letter sent to Department of Justice officials by Bill Pulte, director of the Federal Housing Finance Agency.

Pulte’s letter alleged that Cook claimed homes in two states as her primary residence to potentially get more favorable mortgage rates, and then allegedly received rental income from one of the properties.

Justice Department officials have indicated they will investigate Cook’s real estate transactions, though no criminal charges have been filed.

The Fed responds

The Federal Reserve responded to the claims against Cook in a lengthy statement provided to Scotsman Guide by a Fed spokesperson.

“The Federal Reserve System was established by Congress to carry out its statutory mandates — including promoting maximum employment, stable prices, and a well-functioning financial system. Congress, through the Federal Reserve Act, directs that governors serve in long, fixed terms and may be removed by the president only ‘for cause,’” the statement began.

“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 statement continued. “The Federal Reserve will continue to carry out its duties as established by law.”

It concluded: “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.

“As always, the Federal Reserve will abide by any court decision. The Federal Reserve reaffirms its commitment to transparency, accountability, and independence in the service of American families, communities, and businesses.”

Other reactions

Trump’s unprecedented decision has unleashed a firestorm of reactions on both sides of the political aisle, with Republican allies praising the move and Democratic leaders condemning it.

“It’s alleged that she’s committed mortgage fraud, and she says, ‘I’m not going anywhere,’” Commerce Secretary Howard Lutnick said during an appearance on CNBC. “Well, the crook always says, ‘I’m not going anywhere.”

Pulte wrote on social media: “Thank you President Trump for your commitment to stopping mortgage fraud and following the law. If you commit mortgage fraud in America, we will come after you, no matter who you are.”

Sen. Cynthia Lummis, R-Wyo., wrote that “@POTUS continues to bring accountability and transparency to the Fed,” using the X handle associated with the president.

U.S. House Minority Leader Hakeem Jeffries, D-N.Y., wrote in a statement that “Donald Trump is trying to remove her without a shred of credible evidence that she has done anything wrong.”

Senate Minority Leader Chuck Schumer, D-N.Y., released a statement saying “this attempted firing shreds the independence of the Fed and puts every American’s savings and mortgage at risk.”

Janet Yellen, who served as Fed chair from 2014 to 2018, also expressed concerns that the move to fire Cook jeopardizes the independence of the Fed.

“I feel this is now turned into an all-out assault on the Federal Reserve and an attempt by President Trump to really gain control over decision-making at the Fed,” Yellen said, according to The New York Times.