The independence of the Federal Reserve has always been more of a gentleman’s agreement than an ironclad rule. President Donald Trump decided to test that in August 2025, and the legal fight that followed is still playing out in the courts.
At the center of it: three mortgage loans tied to properties in Michigan, Georgia, and Massachusetts, all obtained by Federal Reserve Governor Lisa Cook before her appointment to the Board of Governors.
How three mortgages became a constitutional flashpoint
On August 15, 2025, Federal Housing Finance Agency Director Bill Pulte issued a criminal referral alleging Cook had misrepresented how she intended to use the properties, specifically whether each would serve as a primary residence, to secure more favorable loan terms in 2021.
Primary residence loans typically carry lower interest rates and smaller down payment requirements than investment property loans. In English: if you tell a lender you’re moving in when you’re not, that’s fraud.
