Lisa Prepare dinner, governor of the US Federal Reserve, throughout a Fed Listens occasion in Washington, DC, US, on Friday, March 22, 2024.
Al Drago | Bloomberg | Getty Pictures
Federal Reserve Board Governor Lisa Prepare dinner will file a lawsuit difficult her elimination by President Donald Trump, her atto“rney mentioned Tuesday.
“President Trump has no authority to take away Federal Reserve Governor Lisa Prepare dinner,” the lawyer, Abbe Lowell, mentioned in an announcement, a day after Trump cited allegations of mortgage fraud by Prepare dinner in firing her.
“His try to fireplace her, based mostly solely on a referral letter, lacks any factual or authorized foundation,” Lowell mentioned.
“We can be submitting a lawsuit difficult this unlawful motion.”
The White Home and the Justice Division didn’t instantly reply to CNBC’s requests for touch upon Lowell’s assertion.
The Federal Reserve’s media workplace has not commented on Trump’s motion, nor replied to CNBC’s query about whether or not Prepare dinner is working at her workplace on Tuesday or remotely.
If Prepare dinner does sue, the case may find yourself being determined by the Supreme Court docket.
The Federal Reserve Act of 1913 says {that a} president can fireplace a member of the Federal Reserve Board solely “for trigger.”
That has lengthy been understood to imply malfeasance or dereliction of obligation whereas a board member.
The Justice Division final week opened a felony investigation of Prepare dinner after she was accused of creating false statements on residence mortgage purposes by Federal Housing Finance Company Director Invoice Pulte.
Pulte pointed to paperwork that Prepare dinner allegedly signed for properties in Michigan and Georgia saying they had been every her major residence, which he claimed was performed “to be able to doubtlessly safe decrease rates of interest and extra favorable mortgage phrases.”
The paperwork would have been signed earlier than Prepare dinner joined the Fed.
Trump cited these allegations on Monday night time in a letter to Prepare dinner notifying her of her elimination.
Prepare dinner responded Monday, saying in an announcement, “President Trump purported to fireplace me ‘for trigger’ when no trigger exists underneath the regulation, and he has no authority to take action.”
“I can’t resign,” she mentioned. “I’ll proceed to hold out my duties to assist the American economic system as I’ve been doing since 2022.”
— CNBC’s Kevin Breuninger contributed to this story.
