New York Attorney General Letitia James has been criminally indicted by a grand jury for bank fraud, kicking off another politically charged case brought by the same Virginia federal prosecutor who went after former FBI Director James Comey two weeks ago.
James was charged with one count of bank fraud and another count of making false statements to a financial institution. But the nature of the charges was a near mirror image of the case she once led against Trump.
While her full civil trial against him proved that Trump gained hundreds of millions of dollars by inflating assets, this indictment claimed that James secured a mortgage that would earn $17,837 over the full life of the loan — by cutting the interest rate from 3.8% down to 3%.
A grand jury signed off on an indictment that accused James, who lives in Brooklyn, of buying a second property in Norfolk, Virginia, under loan terms that would have required her to use it as a second residence. She instead turned it into a rental property.
Democrats including House Minority Leader Hakeem Jeffries — who said in a statement that the “malicious prosecution” would “not survive scrutiny in a Court of Law” — immediately criticized the indictment.
In New York City, several Democrats held a press conference Thursday evening in response to the indictment.
“I’m angry tonight,” said New York City comptroller Brad Lander. “And you know, in this moment of creeping authoritarianism, keep asking the questions: When is it an emergency? When is it a constitutional crisis? Well, I’m telling you, it is an emergency.”
This historic leveraging of federal law enforcement power marks the start of another criminal case against someone President Donald Trump considers a personal enemy: a state prosecutor who forced him to spend three months in court defending accusations of bank fraud during his second presidential campaign.
The indictment’s descriptions indicated that the Department of Justice had access to James’ tax records, a sensitive point that touches on growing concerns that the Trump administration has been willing to turn what were once largely considered off-limits government records on the citizenry into a cudgel. The indictment points out the alleged discrepancy between James’ loan application and her use of the property by comparing her insurance paperwork with tax forms.
“James filed Schedule E tax form(s), under penalties of perjury, treating the Perrone Property as rental real estate, reporting fair rental days, zero personal use days, thousand(s) of dollars in rents received, and claiming deductions for expenses relating to the property, further contradicting the second home classification,” the indictment reads.
The case, filed in the Eastern District of Virginia, was assigned to U.S. District Judge Jamar K. Walker, a former public corruption federal prosecutor in the district who was appointed in 2023 by former President Joe Biden.
Lindsey Halligan, the only listed government attorney on the docket, has long been intertwined with Trump, first as a beauty pageant contestant in the Trump-run Miss USA, and later as his defense lawyer during the Mar-a-Lago classified documents case. She most recently served as a legal aide in the White House.
“No one is above the law. 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 facts and the law in this case are clear, and we will continue following them to ensure that justice is served.”
Trump appointed Halligan to replace Erik Siebert, a Virginia federal prosecutor he also appointed but who reportedly refused to partake in politically charged cases concerning Trump’s perceived enemies. A source told NOTUS that Halligan understood the role would come with the explicit expectation to pursue vengeance against Trump’s foes.
James oversaw the most serious threat to Trump’s real estate empire in 2023, when her office pursued a civil case against him and his heirs for rampant falsification of property values. After Trump’s legal team failed to request a jury trial, a New York state judge who examined extensive evidence concluded that Trump committed bank fraud and owed nearly half a billion dollars.
An appellate court recently overturned that finding, ruling that the large sum violated the Eighth Amendment, which prohibits the government from imposing excessive fines.
However, Trump remained enraged at James, who campaigned for her elected position on the explicit promise that she would pursue a case against Trump — and did.
If convicted, Letitia James faces up to 30 years in prison and $1 million in fines.
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This story was produced as part of a partnership between NOTUS and The City.
Editor’s Note: This story was updated with additional reporting.