Letitia James Facing As Many As 60 Years In Prison In Mortgage Fraud Case
New York Attorney General Letitia James — once the face of Democrat-led prosecutions against conservatives — is now facing serious federal charges of her own. A grand jury on Thursday indicted James on two counts: bank fraud and making false statements to a financial institution, after prosecutors alleged she lied on a mortgage application to secure favorable terms for a Virginia home she later used as a rental property.
According to the indictment, James co-purchased a single-family home in Norfolk, Virginia, in August 2020 for roughly $137,000, with a $109,600 loan that explicitly prohibited her from renting out the property. Prosecutors say James misrepresented the property as a second home, a move that allowed her to qualify for lower rates and save nearly $19,000 over the life of the loan.
The criminal case stems from a referral by Federal Housing Finance Agency (FHFA) Director William Pulte, who referred the matter to the Department of Justice earlier this year. That referral sparked a federal probe culminating in this week’s indictment.
Financial records reviewed by the New York Post show that James listed the Norfolk property as an “investment” on her state ethics disclosures from 2020 through 2023, contradicting her claim on the mortgage application that it was a second home. Only in 2024 — weeks after the FHFA referral — did she change the classification to “real property.”
“The indicted attorney general also estimated the value of the property anywhere between $150,000 and $200,000,” the Post reported.
Prosecutors allege that despite agreeing to a “Second Home Rider” requiring her to personally occupy the residence, James never lived there and instead used the property as a rental investment — earning thousands in unreported income.
“Despite these representations,” the indictment states, “the Norfolk property was not occupied or used by James as a secondary residence and was instead used as a rental investment property.”
Federal investigators also found that James lied on her homeowners’ insurance application, claiming the home would be “owner-occupied,” while her tax filings described it as “rental real estate” generating “thousand(s) of dollars in rents received.”
If convicted on both charges, James faces up to 60 years in prison and fines totaling as much as $2 million. She is scheduled to make her first court appearance on October 24.
The political fallout could be immense. As the chief law enforcement officer of New York, James has long wielded her office against conservative figures — including President Donald J. Trump and his family. Now, critics say she’s facing the same kind of accountability she often preached.
Adding to the controversy, James has decided not to use the state’s $10 million legal defense fund for public officials, opting instead to rely on the Democratic Attorneys General Association (DAGA) to bankroll her defense. That decision has triggered a new wave of transparency concerns, since DAGA’s financial disclosures are limited and its donor allocations are largely discretionary.
Legal experts estimate her defense could cost between $5 million and $10 million. Abbe Lowell — the high-powered attorney representing her — reportedly charges over $1,000 per hour and requires a $1 million retainer.
Former federal prosecutor Neama Rahmani told the New York Post that James’s legal bills could ultimately reach eight figures.
“I think all in, it’s probably going to be in the range of $5 to $10 million,” Rahmani said.
James, who once boasted of holding others “accountable under the law,” now faces a legal reckoning of her own — one that could define her career and tarnish the office she leads.