A federal grand jury has indicted Letitia James, the New York attorney general, for bank fraud and making false statements. Two charges were brought against James, who had brought a civil fraud case against the Trump Organization in 2022 that Trump claimed was a malicious prosecution.
Lindsey Halligan, the US attorney for the eastern district of Virginia, personally presented the case to the grand jury on Thursday, the person said. US attorneys do not typically present to a grand jury.
“This is nothing more than a continuation of the president’s desperate weaponization of our justice system. 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 said in a recorded video statement on Thursday.
“These charges are baseless, and the president’s own public statements make clear that his only goal is political retribution at any cost. The president’s actions are a grave violation of our constitutional order and have drawn sharp criticism from members of both parties.”
Halligan was installed in the role last month after Donald Trump became frustrated with the pace of investigations against his rivals. “No one is above the law,” Halligan said in a statement. “The charges as alleged in this case represent intentional, criminal acts and tremendous breaches of the public’s trust. The facts and the law in this case are clear, and we will continue following them to ensure that justice is served.”
According to a copy of the federal indictment, James is charged with one count of bank fraud and one count of making false statements to a financial institution. James’s attorney, Abbe Lowell, said his client “flatly and forcefully denies these charges”.
James is set to appear in a Virginia court on 24 October. Her attorneyswill probably argue that the charges arise from a vindictive and selective prosecution and there is no “material fact” to the charges and should be dismissed.
Democratic party officials were quick to defend James.
“New Yorkers know @NewYorkStateAG James for her integrity, her independence, and her relentless fight for justice,” New York’s governor, Kathy Hochul, posted on X. “What we’re seeing today is nothing less than the weaponization of the Justice Department to punish those who hold the powerful accountable.”
The Democratic mayoral candidate for New York City, Zohran Mamdani, said in a statement: “No one should be surprised that Donald Trump is employing fascist tactics – prosecuting his opponents, weaponizing the federal government, and attacking the very fabric of our democracy. And Trump should not be surprised when millions of Americans stand up to his authoritarianism and his greed.”
New York City’s comptroller, Brad Lander, condemned the indictment, pointing to the mortgage fraud case James brought against the Trump organization in 2022 that resulted in a $464m judgment that was later overturned as a excessive.
“Tish James knew the risk that she was taking when she brought that prosecution, and I, like many other people, said something to her at the time,” Lander said. “And when she says ‘without fear or favor’, you know she means it.”
The US president has made little secret of his desire to use the justice department to punish his rivals. “What about Comey, Adam ‘Shifty’ Schiff, Leticia [sic]??? They’re all guilty as hell, but nothing is going to be done,” he said in a September post on Truth Social that was addressed to Pam Bondi, the US attorney general. “We can’t delay any longer, it’s killing our reputation and credibility.”
The move is Trump’s latest effort to weaponize the Department of Justice to punish political rivals. It comes two weeks after Halligan secured charges against James Comey, the former FBI director. Career prosecutors prepared a memo in that case outlining why charges were not warranted. Comey pleaded not guilty on Wednesday.
A grand jury empaneled earlier this year had been investigating allegations that James may have committed fraud when she helped her niece buy a home in Virginia.
James received a $137,000 mortgage on the home in 2020. The indictment alleges that James got a more favorable mortgage rate of 3% because she signed a “Second Home Rider”, which required her to use the property as a secondary residence.
But prosecutors say she rented the property out to others, which meant that she should have paid a mortgage rate of 3.815%. According to the indictment, she saved a total of $18,933.
It was not known that prosecutors were scrutinizing James’ 2020 home purchase. Prosecutors were believed to be investigating a 2023 home she purchase in Norfolk she assisted her niece with. On a document that was part of that transaction, there was a box checked indicating James intended to use it as her primary residence, which would make better mortgage rates available. But in other documents and emails with her mortgage broker, James clearly indicated she did not intend to use the home as her primary residence.
A career prosecutor in the eastern district of Virginia, Elizabeth Yusi, had determined there was not probable cause to file mortgage fraud charges against James and had been preparing to present her thinking to Halligan.
James attracted Trump’s ire after she led a civil fraud case against the president and his business that resulted in a $500m fine. The fine was recently overturned by an appellate court.
There has been considerable turmoil in the US attorneys office for the eastern district of Virginia in recent weeks. Erik Siebert, Halligan’s predecessor, was removed from his post for failing to bring charges against Comey and James. Maya Song, one of his top deputies, was also fired. A third prosecutor, Michael Ben’Ary, who was not involved in the Comey case, was also fired after being targeted by Trump allies online.
William Pulte, the head of the Federal Housing Finance Agency and a staunch Trump ally, has made criminal referrals on mortgage issues against several Trump rivals, including James, the California senator Schiff, and the Federal Reserve governor Lisa Cook.
