N.Y. AG Letitia James pleads not guilty to bank fraud charges in federal court

Norfolk, Virginia — New York Attorney General Letitia James pleaded not guilty Friday to federal bank fraud charges in Norfolk, Virginia, after the Justice Department indicted her earlier this month.

“Not guilty, judge, on both counts,” James told U.S. District Judge Jamar Walker, appointed to the federal bench by former President Joe Biden, who is presiding over the case.

James’ trial is scheduled to begin on January 26, although that could change. Walker said the procedure is expected to last about five days. James was released on her own recognizance.

In his remarks outside the courthouse after the proceedings, James thanked his supporters – who chanted “we stand with you” and had gathered for his arraignment. She said their support “boosted my morale”.

“It’s not about me. It’s about all of us and a justice system that has been weaponized, a justice system that has been used as a tool of vengeance…and a weapon against these individuals who simply did their job and stood up for the rule of law, and a justice system that is unfortunately being used as a vehicle for retaliation,” she said.

“But my faith is strong and my faith is…I have this belief in the justice system and the rule of law, and I have a belief in America,” James said.

New York’s attorney general said she has heard from people across the country asking her to stay strong.

“There’s no fear today, no fear,” James said. “Because I believe that justice will rain like water and righteousness like a mighty stream, and I am here to say that my work and everything that I do throughout my public career – I have stood up for the rights of New Yorkers and Americans and I will not be deterred…I will not be distracted. I will do my job every day.”

James’ attorney, Abbe Lowell, said at the arraignment that he would seek to have the charges against James dropped on several grounds, including vindictive and selective prosecution, and that the indictment did not allege appropriate charges.

The judge set hearings on those motions for December.

THE the indictment alleges that James misrepresented how she would use a house she purchased in Norfolk in 2020, in order to get a lower interest rate on her mortgage. Instead of using the property as a second home, the indictment states, she rented it to a family member, treating it as an investment property, in violation of the terms of the mortgage.

According to the indictment, James purchased the home for $137,000 and borrowed $109,600 — and because she benefited from more favorable loan terms and stronger seller credit, she allegedly saved $18,933 over the life of the loan.

James called the accusations “baseless” in a video statement.

“This is nothing but a continuation of the president’s desperate militarization of our justice system,” she said.

James’ lawyer, Abbe Lowell, said James “categorically and forcefully denies these accusations” and said he was “deeply concerned that this case is motivated by President Trump’s desire for revenge.”

In two legal filings Thursday, James’ legal team took aim at the Trump-appointed prosecutor who oversaw his bank fraud case, accusing Acting U.S. Attorney Lindsey Halligan of inappropriate conversation with a journalist and undertook to request the dismissal of the indictment on the grounds that Halligan was illegally appointed to this position.

Shortly after the proceedings concluded, Lowell filed a motion to dismiss the indictment on the grounds that Halligan’s appointment as acting U.S. attorney was invalid and unconstitutional. It also seeks a court order that would prevent Halligan from overseeing the prosecution of James’ case and performing any other duties as acting U.S. attorney.

Halligan, he wrote, “had no authority to litigate this case on behalf of the United States.”

“[B]Because this indictment would not have been sought or obtained without Ms. Halligan’s illegal appointment…the defects in the indictment cannot be dismissed as harmless error,” Lowell wrote. “This Court must reject the executive branch’s brazen attempt to circumvent constitutional and statutory limitations on the appointment of U.S. attorneys. »

Days before James was indicted, a grand jury impaneled by the same federal prosecutor’s office handed over an indictment against former FBI Director James Comey, accused of lying to Congress, with whom Mr. Trump clashed during his first term. Comey is also seeking to have the charges against him dropped on the grounds that Halligan’s appointment as acting U.S. attorney is invalid and illegal.

A hearing on these efforts in the Comey and James cases will be held Nov. 13 at the federal courthouse in Alexandria, Virginia, before South Carolina Federal Judge Cameron Curry.

Last month, Mr. Trump publicly urged Attorney General Pam Bondi to take action against Comey and James, as well as against Democratic Senator Adam Schiff of California, another vocal critic of his administration.

The Ministry of Justice spear a criminal investigation against James in May regarding mortgage fraud. Three months later, he expanded its investigation on the New York Attorney General’s Office’s handling of the Trump Organization investigation.

In February 2024, New York State obtained a civil judgment for fraud against Mr. Trump and the Trump Organization for a $354 million fine for submitting what the judge called “patently false financial data” to accountants in order to borrow more money at more favorable interest rates.

The ruling also barred the Trump Organization from soliciting loans from New York financial institutions for three years and also barred Mr. Trump from serving as an officer or director of any New York corporation for three years. A court of appeal erased the fine in August, but James is appealing the decision. The court, however, upheld the other sanctions.

Mr. Trump announced last month that he had Halligan selecteda former White House aide, to temporarily lead the U.S. Attorney’s Office in the Eastern District of Virginia after the brutal eviction of the prosecutor he had initially appointed to this position, Erik Siebert.

Sources told CBS News that Halligan presented evidence only to the Comey and Letitia James grand juries, rather than to prosecutors who worked on the cases. Since Halligan became Acting U.S. Attorney for the Eastern District of Virginia, several prosecutors have left or been replaced. licensed.

Two federal prosecutors in the office, Kristin Bird and Elizabeth Yusi, were fired last week from their positions as assistant U.S. attorneys in the Norfolk office after expressing opposition to the criminal case against James. The office’s top national security official, Michael Ben’Ary, was also fired in recent weeks.

As a result of the change, two federal prosecutors from North Carolina have been hired to handle the Comey case, and a federal prosecutor from Missouri will present the James case.