Cooked Books: May an Employee Be Fired for Unproven Malfeasance?

Adapted from the writings of Dayan Yitzhak Grossman

September 11, 2025

The Associated Press reports:

President Donald Trump said Monday night that he’s firing Federal Reserve Governor Lisa Cook, an unprecedented move that would constitute a sharp escalation in his battle to exert greater control over what has long been considered an institution independent from day-to-day politics.

Trump said in a letter posted on his Truth Social platform that he is removing Cook effective immediately because of allegations that she committed mortgage fraud.

Cook said Monday night that she would not step down. “President Trump purported to fire me ‘for cause’ when no cause exists under the law, and he has no authority to do so,” she said in an emailed statement. “I will not resign.”

Bill Pulte, a Trump appointee to the agency that regulates mortgage giants Fannie Mae and Freddie Mac, made the accusations last week. Pulte alleged that Cook had claimed two primary residences—in Ann Arbor, Michigan, and Atlanta—in 2021 to get better mortgage terms. Mortgage rates are often higher on second homes or those purchased to rent…

The law allows a president to fire a Fed governor “for cause,” which typically means for some kind of wrongdoing or dereliction of duty. The president cannot fire a governor simply because of differences over interest rate policy…

“The American people must have the full confidence in the honesty of the members entrusted with setting policy and overseeing the Federal Reserve,” Trump wrote in a letter addressed to Cook, a copy of which he posted online. “In light of your deceitful and potentially criminal conduct in a financial matter, they cannot and I do not have such confidence in your integrity.”

Trump argued that firing Cook was constitutional. “I have determined that faithfully enacting the law requires your immediate removal from office,” the president wrote…[1]

Three years ago, we wrote:

Poskim generally agree that an employee may be fired for cause. Generally accepted examples of cause are theft or other malfeasance by the employee, although poskim disagree whether the burden of proof is upon the employer to demonstrate the theft or malfeasance, or if a mere allegation is sufficient (provided that the allegation is of facts that a bais din agrees are valid grounds for suspicion of problematic behavior). Similarly, there is an opinion that maintains that a mere rumor (kol) of theft is sufficient grounds for termination, since it is entirely clear (umdena demuchach) that the employer would never have hired and trusted an employee who is rumored to be suspected of theft.[2]

In this article and a follow-up, we consider whether public officials can be fired for alleged or rumored—but unproven—impropriety, as well as some other contexts in which the halacha gives weight to such rumors.

The Gemara has a seminal discussion of various types of rumors and their respective significance. It records a dispute whether a woman who is suspected of adultery, but whose guilt has not been decisively established via witnesses, must be divorced from her husband. The Gemara concludes:

And the halacha is in accordance with Rav (who does not give credence to rumor unless it is verified by witnesses), and the halacha is in accordance with Rebbi (who does give credence to rumor).

But these rulings contradict one another!

It is not a difficulty. This one deals with a rumor that stopped (kala depasik), and that one deals with a rumor that did not stop (kala delo pasik). In the case of a rumor that did not stop, though there are no witnesses, he must divorce her, as Rebbi ruled. In the case of a rumor that stopped, he must divorce her only if there are witnesses, as Rav ruled.

And a rumor that did not stop, how long must it endure?

Abayei said: Mother told me, “The suspected ones of a city [gain that designation] after a day and a half.”

But we do not say that except with a rumor that did not stop in the interim (i.e., no counter-rumor arose at any point during the day and a half.). But if it did stop in the interim, then it stopped.

And we do not say that a rumor forbids her to her husband except when there are no enemies (who would spread it falsely). But if there are enemies, we may assume it was the enemies that issued the rumor.[3]

Elsewhere, the Gemara states:

Rav said: We give malkus (flogging) for a violation of “the report is not good” (i.e., to a person who is the subject of bad rumors). As it says, “No, my sons, for the report that I hear is not good” (Shmuel I 2:24).[4]

The Maharik (R’ Yosef Colon) explains that this is limited to a rumor that is widely accepted and unceasing (eino poseik), because presumably “it is not for nothing that the rumor emerged.

But where it is known that the rumor came from someone who is not credible…it is exceedingly obvious that this rumor has no substance, and it constitutes “a rumor with its receipt” (i.e., a rumor accompanied by a reason to discount it).[5] We need not be lengthy about this, for it is obvious even to schoolchildren…[6]

The Chafetz Chaim paraphrases the Maharik:

Only a rumor that the public agrees on is called a kala delo pasik; if it is known to us that only one person initially promulgated the rumor, and through him it spread throughout the city, it is not called a kala delo pasik. It is certainly forbidden to rely upon this rumor chas veshalom and embarrass him on its account, because this is called a rumor with its receipt…and a fortiori if the one who started it has a quarrel with him…[7]

Elsewhere, the Gemara says:

Rav Ashi said: Someone whose reputation is sullied (snei shum’anei), it is permitted to embarrass him with gimel and shin (the gimel represents “son of an adultress,” and the shin represents “a putrid name”—Rashi).[8]

The Chafetz Chaim rules that accepting slander as true (kabalas lashon hara) and taking adverse action against its subject are prohibited even if the subject is widely rumored to have sinned. He narrows the category of snei shum’anei as follows:

It appears obvious that snei shum’anei refers to someone about whom rumors spread many times that he commits aveiros—one time a rumor spreads that he did this, and another time that he did that—to the point that he is established in the city as a person suspected of these sins, as certainly all the people of the city would not constantly err. It is therefore permitted even for someone who does not actually know him to accept it, to establish him as bad, and to embarrass him. But this is not the case if one happened to hear that someone did something improper who was not heretofore established to be guilty of it. In that case, even if he heard it from many people, it is forbidden to rely upon it and hate him, and a fortiori to speak lashon hara about him or to embarrass him…[9]

In a subsequent discussion, the Chafetz Chaim inclines toward the view that it is prohibited to embarrass someone or even to believe him guilty based on a single rumor, even if that rumor qualifies as a kala delo pasik. But he is not entirely certain of this.[10]

In the following article, we shall iy”H continue to explore the halachos of rumors of impropriety in general, and those that constitute kala delo pasik in particular.

[1]Christopher Rugaber and Will Weissert. Trump says he’s firing Fed Governor Lisa Cook, opening new front in fight for central bank control. https://apnews.com/article/federal-reserve-lisa-cook-trump-6fca3d2fbb54ba204cc91398e6a7b020.

[2]You May Fire at Will, Jul. 14, 2022.

[3]Yevamos 25a.

[4]Kidushin 81a.

[5]See Gittin 89a.

[6]Shu”t Maharik (Warsaw 5644) shoresh 188 p. 223 column 2.

[7]Chafetz Chaim, Hilchos Lashon Hara perek 7 Be’er Mayim Chaim os 8 s.v. Veda od delo nikra kala delo pasik. The Chafetz Chaim makes the same point in Biur Halacha 53:25.

[8]Megillah 25b (and see Rashi there).

[9]Chafetz Chaim, Hilchos Lashon Hara perek 7 se’if 4 and Be’er Mayim Chaim os 8.

[10]Ibid. Be’er Mayim Chaim os 10 (in the hagahah).