President Donald Trump announced on Monday the firing of Federal Reserve Board Governor Lisa Cook, escalating his ongoing criticism of the central bank’s independence over its refusal to cut interest rates.

The move, detailed in a letter posted to Truth Social, marks an unprecedented attempt to remove a Federal governor, prompting immediate pushback from Cook and legal threats.

Trump’s letter cited allegations by Federal Housing Finance Agency Director Bill Pulte, who claimed Cook made false statements on mortgage applications.

“There is sufficient reason to believe you have made false statements on one or more mortgage agreements,” Trump wrote, pointing to documents where Cook listed properties in Michigan and Georgia as her primary residence within weeks of each other.

Trump added, “In light of your deceitful and potentially criminal conduct in a financial matter, [the American people] cannot and I do not have such confidence in your integrity.”

The Justice Department began investigating the claims four days earlier, but Cook, the first Black woman to serve as a Federal governor, rejected the termination.

“President Trump purported to fire me ‘for cause’ when no cause exists under the law, and he has no authority to do so,” she said in a statement, pre CNBC. “I will not resign. I will continue to carry out my duties to help the American economy as I have been doing since 2022.”

Cook, appointed by former President Joe Biden, has hired attorney Abbe Lowell, who called Trump’s action “flawed and his demands lack any proper process, basis or legal authority.” Lowell confirmed Tuesday that Cook would file a lawsuit to challenge the firing.

The Federal Reserve Act of 1913 limits the President’s ability to remove governors, allowing it only “for cause,” typically interpreted as malfeasance or neglect.

A Federal spokesman emphasized on Tuesday that “Congress, through the Federal Reserve Act, directs that governors serve in long, fixed terms and may be removed by the president only ‘for cause.’ 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 Federal Reserve will abide by any court ruling, the spokesman added.

Sen. Elizabeth Warren (D-MA) called the move “an authoritarian power grab that blatantly violates the Federal Reserve Act, and must be overturned in court.”

Edward Mills of Raymond James warned that the action “marks an unprecedented moment for central bank independence,” which is likely to unsettle markets.

If upheld, Trump could reshape the Federal Reserve’s seven-member board, where two current governors — Christopher Waller and Michelle Bowman — are his appointees, and Jerome Powell, his 2017 nominee, serves as chair. With one vacancy and his nominee, Stephen Miran, pending Senate confirmation, a successful removal of Cook could give Trump a 4-to-3 majority.

The board influences key interest rates, a point of contention, as Trump has criticized Powell for maintaining a high rate; however, Powell hinted last week at a possible cut in September.