NY AG Letitia James indicted on federal bank fraud, false claims charges

Letitia James, the Attorney General of New York, found herself facing indictment by a federal grand jury in Virginia on Thursday. The charges against her include bank fraud and submitting false information to a financial institution, resulting in approximately $19,000 in savings on a loan for her second home, as disclosed by the Department of Justice.

The indictment was issued in the Eastern District of Virginia, an area that recently witnessed the indictment of former FBI Director James Comey on September 25 for lying to Congress and obstruction of justice.

U.S. Attorney Lindsey Halligan addressed the public, stating, “No one is above the law. The allegations presented in this case signify deliberate criminal acts and serious violations of the public’s trust. The evidence and the law are evident, and we will continue to pursue justice.”

In her response, James characterized the indictment as an extension of what she described as the president’s attempt to manipulate the justice system for his own purposes. “This is merely a continuation of the president’s desperate effort to weaponize our legal system against those who uphold the law,” she asserted.

According to James, the charges are unfounded, emphasizing that the president’s motivations seem rooted in political vendetta. “His actions represent a serious breach of our constitutional principle and have been criticized by individuals from both major political parties,” she stated.

If found guilty on the charges, James could be sentenced to a maximum of 60 years in prison and face a fine of up to $2 million.

The 66-year-old purchased a three-bedroom, one-bath home in Norfolk, Virginia, in August 2020 for about $137,000. Allegedly, much of the purchase was financed through a $109,600 loan which restricted the property from being classified as a rental investment, according to prosecutors.

This classification allowed her to access favorable loan terms typically unavailable for investment properties, saving her around $18,933 over the lifetime of the loan, as detailed in the court document.

When a reporter from the Post visited the Norfolk residence in April, neighbors indicated they had never encountered James at the location.

Furthermore, her income tax forms listed the property as a rental generating substantial income.

Property records in Norfolk reviewed by The Post earlier this year showed James granted power of attorney to her niece, Shamice Thompson-Hairston, on August 17, 2023, enabling the acquisition of the Virginia home, which included a $219,780 mortgage.

The indictment suggests that the alleged bank fraud activities spanned from August 2020 to January 2024, intending to influence OVM Financial, a lender supported by Fannie Mae, in a loan application.

James allegedly misrepresented the intended use of the property, stating it would be a secondary residence while in reality it was utilized as an investment property with no real intention or use for her personal occupancy, according to the indictment.

Bill Pulte, a federal housing regulator, referred James to the Justice Department in April, pointing to potential violations, including wire fraud, mail fraud, and false statements to a financial institution.

James, defending her position, earlier labeled the accusations from Pulte as baseless.

New York Governor Kathy Hochul expressed her concerns regarding the matter, asserting that this reflects a misuse of judicial power targeting those who hold influential figures accountable.

Last year, James won a civil ruling against the Trump Organization, claiming inflated evaluations of Trump’s real estate assets. The former president was mandated to pay $355 million in penalties, but successfully challenged the ruling in August, resulting in a reversal of the fines.

James’ office is currently seeking to reinstate the judgment, which with accrued interest has exceeded $500 million.

The FBI initiated the investigation into criminal activities in May following Pulte’s referral, which also contained allegations that James misclassified her Brooklyn brownstone by underreporting its number of units.

This misclassification could have potentially provided her with more advantageous loan conditions for both her New York and Virginia houses, according to Pulte.

Additionally, similar allegations of mortgage fraud have surfaced against Senator Adam Schiff (D-Calif.) concerning improper claims about his primary residence in Maryland.

Erik Siebert, Halligan’s predecessor as U.S. Attorney, resigned last month after opting not to pursue charges against Comey and James amid scrutiny from Trump, who expressed frustrations that the DOJ hadn’t firmly pursued the case against Comey.

“The decision to replace a U.S. Attorney who refused to act against me with someone who shows loyalty not to the law, but to the president, undermines the fundamental principles of our nation,” James stated in her remarks. “It is crucial for leaders from all sides to oppose these blatant abuses of justice.”