• The U.S. Justice Department has initiated a criminal investigation into Fed Governor Lisa Cook.
• Allegations include listing multiple properties as primary residences to obtain favorable mortgage terms.
• Cook has filed a lawsuit challenging her removal by Trump, citing unproven allegations.
• The case could have significant implications for the Federal Reserve's independence.
• Cook's legal team argues that the investigation is politically motivated.

The U.S. Justice Department has launched a criminal mortgage fraud probe into Federal Reserve Governor Lisa Cook and has issued grand jury subpoenas out of both Georgia and Michigan. This investigation follows a referral from Federal Housing Finance Agency Director Bill Pulte, who accused Cook of fraudulently listing more than one property as a primary residence when applying for mortgages, potentially to secure lower interest rates. Cook owns properties in Michigan, Georgia, and Massachusetts, raising concerns over her declarations during the mortgage application process, according to Reuters, SCMP, and India Times.

Cook was abruptly removed by President Donald Trump, who cited the fraud allegations as justification for her termination. Following this, she filed a lawsuit contesting her ousting, asserting that the allegations are unfounded and politically motivated. Her lawyer, Abbe Lowell, has publicly criticized the Justice Department for what he describes as a politically charged investigation, claiming that "the questions over how Governor Cook described her properties [...] are not fraud," as noted in reports by Reuters and Al Jazeera.

The implications of this case are significant for the independence of the Federal Reserve, as any findings that lend credence to the allegations of fraud could disrupt its ability to function free from political interference. Observers believe the case may eventually escalate to the U.S. Supreme Court, as it involves central questions about whether the president can dismiss Fed officials based on allegations such as these, according to AA and Al Jazeera.

Cook's legal team asserts that all property disclosures made during her appointment vetting process were known to relevant authorities, thereby rendering any subsequent claims against her regarding these disclosures as illegitimate. The ongoing investigation also reflects broader political tensions, as Cook becomes the third public official implicated in related mortgage fraud inquiries, as indicated by reports from Reuters and India Times.