Letitia James Pleads Not Guilty in Federal Mortgage Fraud Case as Trial Looms
New York Attorney General Letitia James pleaded not guilty Friday to two felony charges in a federal courtroom in Norfolk, Virginia. The charges, brought by prosecutors from the Eastern District of Virginia, allege James committed bank fraud and made false statements in connection to a 2020 home purchase in the area.
According to the indictment, James misled her mortgage lender by claiming the property would serve as a secondary residence when, in fact, she allegedly intended to rent it out for income. That misrepresentation, prosecutors say, enabled her to secure a lower interest rate, potentially saving nearly $19,000 over the life of the loan.
James stood before U.S. District Judge Jamar K. Walker and entered her own not guilty plea. She is being represented by high-profile defense attorney Abbe Lowell and former federal prosecutor Andrew Bosse.
The case is already drawing scrutiny, not only for its substance but for the political storm surrounding it. The charges were brought forward by newly installed Acting U.S. Attorney Lindsey Halligan, a former Trump White House aide. President Donald Trump appointed Halligan to lead the Eastern District of Virginia last month after pushing out interim U.S. Attorney Erik Siebert, who had resisted calls to prosecute Trump’s longtime critics.
James, a Democrat, famously ran for Attorney General on a platform vowing to investigate Donald Trump and later spearheaded a civil fraud suit that resulted in a $450 million judgment against the former president, though the penalty was later thrown out on appeal.
In a statement following her indictment, James called the case “a continuation of the president’s desperate weaponization of our justice system.” Outside the courthouse Friday, she reiterated her belief that the prosecution is “politically motivated revenge,” but said she remained strong and unafraid. “Never cow down or break or bend,” she told supporters gathered outside. “There is no fear today. I will not be deterred.”
Halligan fired back, saying: “No one is above the law. The charges as alleged represent intentional criminal acts and tremendous breaches of the public’s trust.”
The indictment accuses James of knowingly deceiving a financial institution in order to secure a more favorable mortgage, and prosecutors claim the false statements were part of a deliberate scheme.
James’ defense team plans to file motions to dismiss, including for selective and vindictive prosecution, echoing motions filed this week by former FBI Director James Comey in his own federal case. Her lawyers are also expected to challenge Halligan’s appointment and the legality of her role in bringing the indictment.
Judge Walker scheduled the trial to begin on January 26, 2026, with pre-trial motion hearings set for early December. The Justice Department declined to comment.