Lisa Cook, governor of the US Federal Reserve, during a Fed Listens event in Washington, DC, US, on Friday, March 22, 2024.
Al Drago | Bloomberg | Getty Images
House Democrats on Thursday asked an independent watchdog to open a review of Federal Housing Finance Agency Director Bill Pulte’s allegations of mortgage fraud against Federal Reserve governor Lisa Cook.
The lawmakers, led by House Financial Services Committee ranking member Maxine Waters, D-Calif., told the FHFA’s inspector general in a letter obtained by NBC News that they are concerned if Pulte has “complied with all applicable federal and agency statutes, regulations, policies, and procedures during its acquisition, review, and/or public release of any document related to Governor Dr. Lisa Cook’s mortgage applications and any other mortgage related documents.”
In turn, the 24 Democrats asked the inspector general to “review all the circumstances and activities related to the FHFA’s acquisition and review of Governor Dr. Cook’s mortgage applications as well as any announcements, statements, and release of documents related to this matter in order to determine whether any statutory, regulatory, or agency policies may have been violated.”
Pulte, a former housing executive whom President Donald Trump appointed to run the mortgage agency, has attacked the Fed and Chair Jerome Powell for months. Last month, he said he made a criminal referral to the Justice Department, accusing Cook of committing mortgage fraud. The DOJ launched an investigation. Cook has denied the accusations in legal filings.
Pulte hasn’t disclosed how he determined Cook had committed the alleged fraud. A week ago, CNBC asked him how came across Cook’s mortgage details. He responded that he received a “tip” but added, “I’m not going to explain our sources and methods, where we get tips from, who are whistleblowers.”
Trump attempted to fire Cook after Pulte’s accusations, but she can keep her job for now. A judge ruled in her favor on Tuesday night, temporarily blocking her removal from the Board of the Federal Reserve System. The Trump administration quickly appealed.
At the moment, Cook, the first Black woman to work on the Fed board, should be able to participate in the central bank’s highly anticipated meeting on Tuesday and Wednesday where policymakers will likely vote to lower interest rates.
“What were the sets of events that initially led to questions regarding Dr. Cook’s mortgage,” the Democrats ask in their letter. They also asked if the information arose as a result of “a standard, planned audit, review or investigation” or “if not, how did the issue come to the attention of the FHFA?”
They asked the inspector general to review a number of additional items, including if there are “any indications that the information was acquired as a result of a search specifically initiated to look at mortgages involving a specific individual or group of individuals?” They also ask whether it was handled by the “appropriate” staffers and offices.
Pulte has leveled similar allegations of mortgage fraud against Democratic New York Attorney General Letitia James and U.S. Sen. Adam Schiff, D-Calif. Both of them have regularly battled Trump.
The lawmakers also want to know whether members of the FHFA’s legal and policy staff were a part of the review of the documents and if the review complied “with all applicable federal and agency statutes, regulations, and procedures regarding such activities.”
The FHFA and the inspector general’s office did not immediately respond to a request for comment on the letter.
