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Federal Reserve Governor Lisa Cook is refusing to resign after President Donald Trump said in a letter he had “removed” her “effective immediately.” Trump posted the letter on Truth Social, just five days after first calling for her resignation on the platform. It’s an unusual stand-off between Cook and the president that has sparked a constitutional debate about presidential powers and the independence of the Federal Reserve.

The president said in the letter to Cook that he was acting under the U.S. Constitution and the Federal Reserve Act of 1913, which says presidents can remove governors from the Fed’s Board “for cause.” Trump said there was “sufficient reason to believe” Cook “made false statements on one or more mortgage agreements.” “I have determined that faithfully enacting the law requires your immediate removal from office,” Trump wrote.

Trump has alleged the Fed Governor committed mortgage fraud, citing a criminal referral made by Bill Pulte, a Trump-appointed member of an agency overseeing Fannie Mae and Freddie Mac. In an interview on Fox Business’ “Mornings with Maria,” Pulte accused Cook of claiming two primary residences in 2021, one in Ann Arbor and the other in Atlanta, to get favorable mortgage rates.

“I think what happened is very, very simple to understand,” Pulte said. “It’s very odd to see people try to twist back way sideways and upside down to justify mortgage fraud. This is a very serious crime. Mortgage fraud carries up to 30 years in prison. I believe the president has ample cause to fire Lisa Cook. Whether he wants to do that or not is entirely up to the president. However, we will go where mortgage fraud is. If mortgage fraud is with a Republican or a Democrat, it doesn’t matter—if you commit mortgage fraud in President Trump’s America, we’re going to come after you. And Lisa Cook is no exception to that.”

On August 15, Pulte made a criminal referral to the Justice Department, accusing Cook of “making false statements in bank documents and real property records.” A formal charge has not been made.

Cook, a Biden appointee, was confirmed by the Senate and named to the Federal Reserve Board in 2022. She pushed back on Trump’s claim to have the power to remove her. “President Trump purported to fire me ‘for cause’ when no cause exists under the law, and he has no authority to do so. I will not resign. I will continue to carry out my duties to help the American economy as I have been doing since 2022,” Cook said in a statement, which she provided to Fox News Digital.

Cook is being represented by Abbe Lowell, a well-known attorney who previously represented Hunter Biden and New York Attorney General Letitia James, as well as Jared Kushner and Ivanka Trump. In a statement, Lowell called out Trump for the announcement, saying that it was “yet another transparent political stunt to distract from his own myriad of failures.”

“President Trump has taken to social media to once again ‘fire by tweet,’ and once again his reflex to bully is flawed and his demands lack any proper process, basis, or legal authority. We will take whatever actions are needed to prevent his attempted illegal action,” Lowell added.

Lowell later announced he would be filing a lawsuit on Cook’s behalf. “President Trump has no authority to remove Federal Reserve Governor Lisa Cook. His attempt to fire her, based solely on a referral letter, lacks any factual or legal basis. We will be filing a lawsuit challenging this illegal action,” he said.

House Minority Leader Hakeem Jeffries, D-N.Y., Sen. Elizabeth Warren, D-Mass., and Rep. Jamie Raskin, D-Md., also made statements over the weekend against the president and in support of Cook.

“What an outrage and a scandal. This is the big one constitutionally,” Raskin told Axios.

Warren called Trump’s attempt “an authoritarian power grab” and said, “Trump is desperately looking for a scapegoat to cover for his own failure to lower costs for Americans, and firing Lisa Cook is his latest move.”

Jeffries said there is not “a shred of credible evidence that she has done anything wrong” and doubled down on Trump in a press release. “To the extent anyone is unfit to serve in a position of responsibility because of deceitful and potentially criminal conduct, it is the current occupant of the White House. The American people are not buying your phony projection and slander of a distinguished public servant.”

Trump, who has also made a number of unfounded claims about Powell, has repeatedly clashed with the head of the Federal Reserve over interest rates, and he and his allies have been urging the central bank to lower them to help the economy and make the cost of servicing the federal debt more manageable. The national debt currently stands at more than $37 trillion.

The dispute between the president and Powell has raised serious questions about the independence of the Federal Reserve, which has operated for decades with little to no direct interference from Washington. However, in a letter to Cook, Trump said he is firing her because he determined that “faithfully enacting the law requires your immediate removal from office.”

Under the Federal Reserve Act, the president can remove a governor from the Fed’s Board “for cause.” But Cook and her attorneys say no cause exists in this case. With the lawsuit, Cook’s refusal to resign, and Democrats all firing away at Trump, it’s now shaping up to be a fight that could get messy and lead to a showdown over the president’s powers and the independence of the Fed.