NY Attorney General Letitia James Indicted Over Fraud Claims (4)

New York Attorney General Letitia James was indicted by a federal grand jury in Virginia, making her the second of President Donald Trump’s perceived political enemies to be criminally charged in two weeks.

James was charged with one count of alleged bank fraud and one count of making false statements to a financial institution. The indictment made public on Thursday follows allegations from Trump administration officials that James engaged in mortgage fraud.

Letitia James, New York’s attorney general, during a news conference in New York, in 2024.

Photographer: Jeenah Moon/Bloomberg

“These charges are baseless, and the president’s own public statements make clear that his only goal is political retribution at any cost,” James said in a statement. “He is forcing federal law enforcement agencies to do his bidding, all because I did my job as the New York State Attorney General.”

James, who won a civil case against Trump two years before he won a second term as president, has denied committing mortgage fraud. Her attorney, Abbe Lowell, said in a statement James would “fight these charges in every process allowed in the law.”

Loan Applications

The Justice Department’s probe into James stemmed from claims by Federal Housing Finance Agency Director Bill Pulte that she may have committed mortgage fraud based on the residence status she listed on loan applications.

The indictment alleges that to get favorable mortgage terms James falsely represented that a Norfolk, Virginia property she bought in 2020 would be used as a secondary residence. Prosecutors claim that James actually used it as an investment property that she rented to a family, and didn’t intend to occupy it.

Trump had called for legal action against James in a message to Attorney General Pam Bondi on social media last month. “We can’t delay any longer, it’s killing our reputation and credibility,” Trump wrote in a Truth Social post. “JUSTICE MUST BE SERVED, NOW!!!”

James had campaigned on promises to investigate Trump. In 2022, her office sued Trump and his real estate company, alleging he reaped hundreds of millions of dollars in “illegal profit” by inflating the value of assets, including his Mar-a-Lago estate and Trump Tower penthouse. The complaint alleged Trump and his two eldest sons carried out the scheme for years so he could get better loan terms from Deutsche Bank AG and other lenders.

James won after a trial in which Trump took the witness stand and denied wrongdoing. A judge set the penalty at $464 million. But a New York appeals court in August vacated the fine, ruling it was unconstitutionally “excessive,” while upholding the judge’s finding that Trump and his company were liable for fraud. Both sides have appealed, escalating the case to the state’s highest court.

Trump’s defense team blasted James during the trial, saying the case was politically motivated. The judge who oversaw the case declined to toss it out on those grounds, but a dissenting appeals court judge who disagreed with the liability verdict agreed with Trump.

The White House didn’t immediately respond to a request for comment.

‘Criminal Acts’

The US Attorney’s Office in the Eastern District of Virginia, now headed by Lindsey Halligan, also recently secured a grand jury indictment against former FBI Director James Comey, whose prosecution the president also publicly called for. Comey has said he’s innocent and is fighting the charges in court.

“The charges as alleged in this case represent intentional, criminal acts and tremendous breaches of the public’s trust,” Halligan said in a statement. The charges carry potential penalties of as much as 30 years in prison per count and a $1 million fine on each count, as well as forfeiture, according to the statement.

James’ initial appearance in US District Court in Norfolk, Virginia, is set for Oct. 24.

The push by some Trump officials to pursue charges against James had appeared to be stalled until recently. Erik Siebert, who had been leading the Virginia US attorney’s office, resigned his post last month amid pressure. Siebert had determined there wasn’t enough evidence to support charges against James, Bloomberg News had reported.

However, Trump then installed Halligan as interim US attorney. Previously, Halligan was a senior aide at the White House and was tasked with leading an initiative to review exhibits at the Smithsonian’s museums to ensure that they reflect American “excellence” as laid out in an executive order.

Halligan also represented Trump against charges of mishandling classified documents after his first term. She previously was an insurance lawyer in Florida and graduated from the University of Miami School of Law.

The charges against James — coming on the heels of Comey’s arraignment this week — immediately fueled allegations that prosecutors were improperly using the office to punish the president’s perceived enemies.

New York Democratic Senator Charles Schumer accused Trump of using the Justice Department “as his personal attack dog” and going after James for pursuing charges against the president.

“This isn’t justice,” he said. “It’s revenge.”

(Updates with potential penalty details in 13th paragraph. An earlier version corrected the scope of a charge.)

--With assistance from Patricia Hurtado and Zoe Tillman.

To contact the reporters on this story:
Myles Miller in New York at mmiller899@bloomberg.net;
Chris Strohm in Washington at cstrohm1@bloomberg.net;
Erik Larson in New York at elarson4@bloomberg.net

To contact the editors responsible for this story:
Ben Bain at bbain2@bloomberg.net

Elizabeth Wasserman

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