New York Attorney General Letitia James was indicted Thursday by a federal grand jury on bank fraud charges, becoming the second high-profile Democratic leader to face federal prosecution in recent weeks.
The grand jury in the Eastern District of Virginia returned two felony charges against James: bank fraud under 18 U.S.C. Section 1344 and making false statements to a financial institution under 18 U.S.C. Section 1014.
“No one is above the law,” U.S. Attorney Lindsey 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.”
The indictment alleges James bought a house in Norfolk, Virginia, in 2020 with a mortgage that required her to use it as a second home, but she ultimately rented it to a family and used it as an investment property. Prosecutors say James misrepresented that the house was her primary residence to get a lower interest rate.
According to the indictment, James purchased the home for $137,000 and borrowed $109,600. By getting more favorable lending terms and a larger seller credit, she cashed in nearly $19,000 over the life of the loan.
James’ first court appearance is scheduled for October 24 in Norfolk. If convicted, she faces up to 30 years in prison per count and up to a $1 million fine on each count.
The case has been assigned to U.S. District Judge Jamar Walker, an appointee of former President Joe Biden.
James responded to the charges in a video posted to social media, calling them “baseless” and accusing President Donald Trump of weaponizing the justice system.
“This is nothing more than a continuation of the president’s desperate weaponization of our justice system,” James said. “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’ attorney, Abbe Lowell, claimed the case “is driven by President Trump’s desire for revenge.”
“When a President can publicly direct charges to be filed against someone — when it was reported that career attorneys concluded none were warranted — it marks a serious attack on the rule of law,” Lowell said in a statement. “We will fight these charges in every process allowed in the law.”
James, a longtime Trump adversary, previously sued the president’s business empire for civil fraud and won a nearly $500 million judgment in 2024. The verdict was upheld on appeal, but the monetary penalty was thrown out in August after a court deemed it excessive. Trump proclaimed “total victory” after the appellate court’s decision.
The investigation into James stemmed from an April referral to the Department of Justice made by federal housing regulator Bill Pulte, a Trump appointee. Pulte said James “falsified records” to get more favorable loan terms on Virginia properties.
“Based on media reports, Ms. Letitia James has, in multiple instances, falsified bank documents and property records to acquire government backed assistance and loans and more favorable loan terms,” Pulte’s letter stated.
The Justice Department has investigated James since May over mortgage fraud allegations. Federal prosecutors spent months on the case this year before a Republican career prosecutor, Elizabeth Yusi, determined there was not enough evidence to bring charges against James.
However, Erik Siebert, the previous U.S. attorney for the Eastern District of Virginia who also resisted seeking charges, resigned last month. Trump then replaced Siebert with Halligan, his former personal attorney and a White House aide.
Within days of taking the position, Halligan secured an indictment against former FBI Director James Comey on charges of lying to Congress and obstructing a congressional proceeding. Comey pleaded not guilty Wednesday.
Ed Martin, Trump’s Justice Department weaponization chief, posted on social media after James’ charges were announced: “Promises made, Promises kept.” Martin previously posed for photos outside of James’ Brooklyn home in August and called on her to resign in a letter to her attorney.
The indictment comes two weeks after Trump publicly called on Attorney General Pam Bondi to prosecute James, Comey, and Sen. Adam Schiff of California.
“We can’t delay any longer, it’s killing our reputation and credibility,” Trump wrote on Truth Social on September 20. “They impeached me twice, and indicted me (5 times!), OVER NOTHING. JUSTICE MUST BE SERVED, NOW!!!”
Republicans pointed to James’ own past statements in responding to her indictment.
Rep. Marjorie Taylor Greene, R-G.A., noted on X that James previously said “no one is above the law.”
Today, Leticia James was indicted for bank fraud regarding a mortgage loan. pic.twitter.com/Va4L0N1LYN
— Marjorie Taylor Greene 🇺🇸 (@mtgreenee) October 9, 2025
James’ other old social media posts also resurfaced Thursday, including a February 2024 Valentine’s Day message:
For your daily dose of irony: Letitia James, everyone, who was just indicted for cheating to get better loans. https://t.co/sSn3NFcHfR
— The Horn News (@ReadTheHornNews) October 10, 2025
Even CNN commentator Scott Jennings defended the prosecution against Democratic criticism.
“If Democrats like [New York Sen. Elissa] Slotkin are going to come out today and whine about selective prosecutions over Tish James, her entire career is built on the selective prosecution of one man,” Jennings said, referencing James’ campaign promise to investigate Trump before she took office as attorney general.
Senate Democratic Leader Chuck Schumer and other party leaders accused Trump of using the Justice Department to target his political enemies. Democratic lawmakers called the charges an abuse of power and a threat to the rule of law.
The Justice Department has also opened investigations into former Trump national security adviser John Bolton, California Democratic Sen. Adam Schiff, and Federal Reserve Board member Lisa Cook over various allegations. So far, none of those individuals have been charged with crimes, and all deny wrongdoing.
In order to win her election to the office of New York’s state attorney general, James campaigned exclusively on prosecuting Trump. She filed multiple lawsuits and investigations into Trump and his allies and brought the civil fraud case that resulted in the massive judgment against his business empire.