LISTEN LIVE: The Supreme Court case over Trump’s attempt to fire Federal Reserve board member Lisa Cook

WASHINGTON (AP) — President Donald Trump’s unprecedented attempt to reshape the Federal Reserve puts the Supreme Court in a familiar position, as it weighs an emergency appeal from the president’s lawyers in a politically charged case.

The Supreme Court hearing is scheduled to begin Wednesday at 10 a.m. EST. Listen live in the player above.

On Wednesday, the court will hear arguments on Trump’s efforts to oust Federal Reserve Governor Lisa Cook based on allegations that she committed mortgage fraud, which she denies.

He watches: Powell steps back as Trump’s Justice Department launches unprecedented investigation into the Fed

No president has fired a Fed governor in the agency’s 112-year history.

Trump’s critics say the real motive is the Republican president’s desire to wrest control of US interest rate policy. Trump wants interest rates to fall sharply so the government can borrow more cheaply and Americans can pay lower borrowing costs for new homes, cars or other large purchases, as concerns about higher costs have frustrated some voters about his economic stewardship.

Fed Chairman Jerome Powell and the board have cut their key interest rate three consecutive times in the last four months of 2025, but that’s slower than Trump wants. The Fed also indicated that it may leave interest rates unchanged in the coming months, out of concern about sparking higher inflation.

Powell is expected to attend when the justices consider an emergency petition from the Trump administration to allow them to remove Cook from her job while her challenge to the dismissal plays out in court. Lower court judges allowed her to remain in her position as one of seven governors of the central bank.

If Trump can name someone to replace Cook, he will have four appointees on the seven-member board. Cook, the first Black woman to serve on the Fed’s board, was appointed in 2022 by Democratic President Joe Biden.

Columbia University law professor Lev Menand, who joined the brief supporting Cook, said the justices are required to bless Trump’s efforts to effectively undermine the Fed’s independence.

“This case is about much more than the Cook case,” Menand said. “It’s about whether President Trump will be able to take over the Fed in the coming months.”

The threat of the Fed’s independence prompted Powell’s three living predecessors, Alan Greenspan, Ben Bernanke, and Janet Yellen, to vote for Cook. They were joined by five former Treasury secretaries appointed by the presidents of both political parties and other high-level former economic officials.

In their filing, lawyers for the former officials wrote that ousting Cook immediately “would expose the Fed to political influences, thereby eroding public confidence in the independence of the Fed and jeopardizing the credibility and effectiveness of U.S. monetary policy.”

Economists warn that a politicized Fed that gives in to the president’s demands will damage its credibility as an inflation fighter and is likely to prompt investors to demand higher interest rates before investing in US Treasuries.

With the Cook case under review in the Supreme Court, Trump has dramatically escalated his confrontation with the Fed. The Department of Justice opened a criminal investigation into Powell and sent the central bank subpoenas.

Powell himself took a rare step to respond to Trump, calling the threat of criminal charges “pretexts” that mask the real reason, which is Trump’s frustration over interest rates. The Justice Department said the dispute ostensibly revolves around Powell’s testimony before Congress in June about the cost of a massive renovation of the Fed’s buildings.

In Trump’s first year in office, the justices generally, but not always, granted Trump’s pleas for emergency action to counter lower court rulings against him, including allowing the heads of other government agencies to be removed at the president’s discretion, without claiming they did anything wrong.

But the court sent signals that it was approaching the independence of the nation’s central bank more cautiously, describing the Fed as a “uniquely regulated quasi-private entity.”

In the case of Cook, Trump does not assert that he can fire Fed governors at will.

Cook is one of several people, along with New York’s Democratic Attorney General Letitia James and Democratic Sen. Adam Schiff of California, who have been charged with mortgage fraud by federal housing official Bill Bolt. They denied the accusations against them.

The case against Cook stems from allegations that she claimed two properties, in Michigan and Georgia, as “principal residences” in June and July 2021, before joining the Fed’s board. Such claims can result in a lower mortgage rate and a smaller down payment than if one were advertised as a rental property or second home.

Cook has denied any wrongdoing and has not been charged with any crime. “There is no fraud, no intent to deceive, and absolutely nothing criminal or basis for alleging mortgage fraud,” Cook’s attorney, Abby Lowell, wrote to Attorney General Pam Bondi in November.

Cook specified that her Atlanta apartment would be a “vacation home,” according to the loan estimate she took out in May 2021. On a form for a security clearance, she described it as a “second home.” Lowell wrote that the case against her relied largely on “one stray reference” in a 2021 mortgage document that was “obviously innocuous in light of the many truthful and more specific disclosures” about the homes she purchased.

U.S. District Judge Gia Cobb ruled that the Trump administration did not meet the legal requirement that Fed governors can only be fired “for cause,” which she said was limited to misconduct while in office.

Cobb also argued that Trump’s dismissal would have deprived Cook of due process, or the legal right, to object to the dismissal.

By a 2-1 vote, a panel of the federal appeals court in Washington rejected the Trump administration’s request to allow Cook’s dismissal to proceed.

At the Supreme Court, the administration says Cook has no right to a hearing, and the courts have no role to play in reviewing Trump’s actions.

The Attorney General, Dr. John Sawyer said Trump lawfully fired Cook, “after concluding that the American people should not have their interest rates set by someone who made material misrepresentations regarding her mortgage rates that appear to have been gross negligence at best and fraud at worst.”

Sawyer will face Paul Clement, a conservative lawyer who served in Sawyer’s position under President George W. Bush, and who has championed expanding gun rights, against same-sex marriage, and repealing the Affordable Care Act. Both men previously served as law clerks to Justice Antonin Scalia.

Her lawyers told the court that Cook’s fate should not be decided based on “unverified allegations” or “before any facts are found.” She should be able to at least stay at her job while her case is pursued, they wrote.

AP Economic Writer Christopher Rugaber contributed to this report.