As expected, Fed Gov. Cook sues Pres. Trump over his move to remove her from the Fed Board "for cause" .
The suit argues, that the "for clause" provision does not support removal for policy disagreements.
Since the firing, reports suggest the Trump administration is exploring ways to exert greater influence over the Federal Reserve, particularly through the regional banks. Under the current system, regional Fed presidents are selected through a process in which the local Reserve Bank’s board of directors conducts the search and vetting, with final approval granted by the Board of Governors in Washington, D.C.
Speculation has emerged that President Trump ordered the scrutinization of the current Fed Governors and seized on the alleged Cook mortgage fraud case—one that she appears not to be contesting—as an opportunity to strengthen his influence. The strategy, observers suggests, is to gain control of the Board through political appointments.
At present, both Fed Governors Michelle Bowman and Christopher Waller—Trump appointees—voted in favor of the most recent rate cut. Since then, Governor Kugler has resigned, giving Trump another seat to fill. That raises his total appointments to three. With Chair Powell’s term as Fed Chair expiring in May (he could remain on the Board, though this is seen as unlikely), Trump could soon gain a fourth seat.
Given that the Board of Governors consists of seven members, the addition of a Cook replacement nominee would bring Trump’s influence to five of seven seats—a dominant majority that would allow him to reshape monetary policy in a way not seen in decades.
It will be interesting to see how the court rules. Do they give Cook a "stay" until the courts can here the case, or is there enough to grant the Pres. the power to fire?
Below is a process for selecting regional bank presidents.
Selection Process
Each of the 12 regional Federal Reserve Banks (New York, Chicago, San Francisco, etc.) has its own board of directors.
When a president position opens, the bank’s board of directors forms a search committee, often hiring outside search firms to help identify candidates.
The local board interviews and vets candidates — typically senior economists, bankers, regulators, or leaders with strong ties to finance, academia, or policy.
Approval & Oversight
Although the local board runs the search, final approval is required from the Federal Reserve Board of Governors in Washington, D.C.
This step ensures consistency with national Fed policy standards and reduces the risk of local biases influencing the decision.
For the New York Fed, which has special responsibilities in implementing monetary policy, the process is even more rigorous — its president must be approved directly by the Board of Governors.
Eligibility & Restrictions
Candidates must be U.S. citizens and cannot have conflicts of interest (for example, current directors of the bank are not eligible).
Once hired, regional Fed presidents serve five-year renewable terms, with mandatory retirement at age 65 (or 10 years after appointment if hired after 55).
