The U.S. Justice Department has launched a criminal mortgage fraud probe of Federal Reserve Governor Lisa Cook and has issued grand jury subpoenas in Georgia and Michigan, according to documents seen by Reuters and a source familiar with the matter.
The investigation followed a criminal referral from Federal Housing Finance Agency Director Bill Pulte, and is being conducted by Ed Martin, who was tapped by Attorney General Pam Bondi as a special assistant U.S. attorney to assist with mortgage fraud investigations involving public officials, along with the U.S. Attorneys' offices in the Northern District of Georgia and the Eastern District of Michigan, according to the source, who spoke anonymously because the matter is not public.
Pulte, who was appointed by Trump, has accused Cook of committing fraud by listing more than one property as a primary residence when she applied for mortgages, potentially to secure lower interest rates. Cook owns properties in Michigan, Georgia and Massachusetts.
Trump terminated Cook over Pulte's mortgage fraud allegations against her, prompting her to file a lawsuit challenging his effort to oust her.
The case has ramifications for the Fed's ability to set interest rate policy without regard to politicians' wishes, widely seen as critical to any central bank's ability to keep inflation under control.
Trump has demanded that the U.S. central bank cut rates immediately and aggressively, berating Fed Chair Jerome Powell for his stewardship of monetary policy.
In one of her recent legal filings challenging Trump's actions, Cook said she listed mortgages on three properties on forms submitted to the White House and U.S. Senate in the vetting process for her appointment to the Fed in 2022. Any inconsistencies were known when she was confirmed and cannot give Trump grounds to fire her now.
Cook is the third public official to be targeted in a criminal investigation over mortgage fraud allegations.
Martin, who also presides over the Weaponization Working Group and serves as pardon attorney, is also pursuing criminal probes of two Democrat officials: U.S. Sen. Adam Schiff andas New York Attorney General Letitia "Tish" James.
Grand juries have convened in those two cases, which started prior to Martin's new appointment as a special assistant U.S. attorney, according to the source and documents seen by Reuters.