Letitia James pleads not guilty in Virginia mortgage fraud case

Letitia Jim, the New York State Attorney General, pleaded no contest on Friday to charges of false statements and bank fraud brought against her after Donald Trump called for her prosecution in a public statement widely perceived as political revenge.

James, in her first appearance before the federal district court of Virginia, told the judge that she was not guilty on both counts. The case was assigned to Jamar Walker who was nominated as a judge by Joe Biden.

In a five-page indictment, James was accused of falsely declaring in loan documents she would use the home she purchased in Norfolk, Virginia as a second residence to obtain more favorable loan conditions, when in reality she used it as an investing property.

The charges were brought by Trump’s chosen US attorney, Lindsey Halligan. Career prosecutors objected to the charges because they believed that there was not enough evidence to prove beyond a reasonable question and James had not profited materially from the loan.

James will also, according to court documents, soon file a motion for dismissal of the indictment on the grounds that Halligan’s appointment was erroneous and, since only she filed the charges against her, the case should be dismissed.

The prosecution takes place at a time when the Justice Department is experiencing a turbulent period. Trump and other officials have been constantly pressuring the department to bring cases against their perceived enemies, regardless of the strength of the evidence.

Halligan also filed charges in the case of former FBI Director James Comey, after President Obama publicly demanded that she do so. The department also opened investigations against California Senator Adam Schiff, and former CIA Director John Brennan.

The department usually brings criminal cases to trial when prosecutors are confident that they will win the case and maintain a conviction on appeal. Former prosecutors said that this test was most likely not met in the James’ case.

Career prosecutors wrote in a memo sent to Erik Siebert before he was fired abruptly by Trump last week that there were conflicting reports about whether James’s conduct amounted fraud.

The person stated that while the indictment claimed James earned thousands of dollars from renting out her Norfolk home, prosecutors discovered evidence that she let her relatives live there rent-free after she purchased it in 2020 for 137,000.

The person also said that they found no evidence of James charging her relatives to use the property, other than the $1,350 she disclosed on her tax return for 2020, which was a payment that James claimed to have made to cover utilities.

The prosecutors expressed their concern that James’ actions would be difficult to prove if the federal mortgage guidelines were vague. Fannie Mae guidelines don’t clearly state whether “occupied” is defined as requiring a person to stay overnight in a house or just visiting.

James told the loan officers and agents that she was buying the house for her niece.

Abbe Lowell was the leading defense attorney for James. He said that in a previous statement, his client had denied any wrongdoing.

“We are deeply worried that President Trump’s revenge-driven desire is driving this case. He said that when a president publicly orders charges to be brought against someone, even though career attorneys have concluded there are none warranted, it is a serious assault on the rule law.

James is one of Trump’s main targets, and has been since 2018. She ran for New York Attorney General in 2018, vowing to pursue Trump. She launched an investigation against him soon after taking office and accused him of inflating his assets fraudulently.

James was awarded a civil judgement of more than $500m after a month long trial. The New York State appeals court overturned the fine because it was in violation of the US Constitution’s ban on “excessive financial penalties”. However, the conviction remained.

Source:https://www.theguardian.com/us-news/2025/oct/24/letitia-james-mortgage-case-hearing

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