{"id":22370,"date":"2025-11-12T17:08:09","date_gmt":"2025-11-12T17:08:09","guid":{"rendered":"https:\/\/cndailynews.store\/?p=22370"},"modified":"2025-11-12T17:08:09","modified_gmt":"2025-11-12T17:08:09","slug":"james-facing-up-to-60-years-in-prison-in-mortgage-fraud-case","status":"publish","type":"post","link":"https:\/\/cndailynews.store\/?p=22370","title":{"rendered":"James Facing Up To 60 Years In Prison In Mortgage Fraud Case"},"content":{"rendered":"
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New York Attorney General Letitia James was indicted on federal bank fraud charges after prosecutors alleged she lied on a mortgage application to obtain favorable loan terms on a Virginia property she later rented out.<\/p>\n

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The indictment, returned by a federal grand jury, centers on a single-family home in Norfolk, Virginia, that James co-purchased in August 2020 for roughly $137,000. Most of the purchase was financed with a $109,600 loan that prohibited the home from being used as a rental or investment property, according to prosecutors.<\/p>\n

By misrepresenting the property as a second home, James received a lower interest rate and saved \u201capproximately $18,933 over the life of the loan,\u201d prosecutors said in a five-page filing.<\/p>\n

Federal Housing Finance Agency (FHFA) Director William Pulte referred the case to the Department of Justice earlier this year, prompting a criminal probe that led to Thursday\u2019s indictment.<\/p>\n

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According to financial disclosure forms reviewed by the\u00a0New York Post,<\/a>\u00a0James repeatedly listed the Norfolk property as an \u201cinvestment\u201d from 2020 through 2023 in filings with the New York State Commission on Ethics and Lobbying in Government. In 2024, she changed the classification to \u201creal property,\u201d just weeks after the FHFA referral was made.<\/p>\n

\u201cThe indicted attorney general also estimated the value of the property anywhere between $150,000 and $200,000,\u201d the Post reported.<\/p>\n

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Despite the loan\u2019s clear prohibition against rental use, prosecutors allege James used the property as a rental investment and earned thousands of dollars in income that she failed to report on multiple disclosure forms.<\/p>\n

In her 2020 disclosure, James did list an \u201cinvestment real property\u201d in Norfolk that generated between $1,000 and $5,000 in revenue, but it is unclear if that referred to the same home named in the indictment.<\/p>\n

According to prosecutors, James agreed to a \u201cSecond Home Rider\u201d when taking out the loan, which required her to occupy the home as her secondary residence and forbade any rental or shared ownership arrangement.<\/p>\n

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\u201cDespite these representations,\u201d the indictment reads, \u201cthe Norfolk property was not occupied or used by James as a secondary residence and was instead used as a rental investment property.\u201d<\/p>\n

Prosecutors also said James made false statements on her homeowners\u2019 insurance application, claiming the home would be \u201cowner occupied,\u201d and on her federal tax filings, where she classified the house as \u201crental real estate\u201d and reported \u201cthousand(s) of dollars in rents received.\u201d<\/p>\n

The federal indictment charges James with two counts: bank fraud and making false statements to a financial institution. If convicted on both counts, she faces up to 60 years in prison and fines totaling as much as $2 million.<\/p>\n

The judge presiding over James\u2019 mortgage fraud case on Friday rejected a motion seeking to compel federal prosecutors to maintain a log of all their communications with the media.<\/p>\n

Defense attorney Abbe Lowell had filed the request last week, following James\u2019 arraignment on charges of bank fraud and making false statements. The motion cited a report alleging that U.S. Attorney Lindsey Halligan exchanged a series of encrypted Signal messages with a reporter regarding the case,\u00a0the New York Post reported<\/a>.<\/p>\n

\u201c[T]he defendant does not demonstrate that it is necessary for the Court to order the government to track communications with the media in any particular form,\u201d wrote US District Judge Jamar Walker in his six-page order.<\/p>\n

\u201cThe defendant\u2019s request that the government be required to keep a communication log is DENIED,\u201d the Biden-appointed judge ruled.<\/p>\n

Walker further wrote that while Halligan\u2019s Signal chat with Lawfare senior editor Anna Bower earlier this month was \u201cunusual,\u201d he nevertheless declined to offer an opinion \u201con whether they were improper in any sense, either legal or ethical.\u201d<\/p>\n

Halligan\u2019s Signal messages to the reporter were configured to automatically disappear after eight hours, The Post reported.<\/p>\n

The judge did not address whether Halligan\u2019s communications \u2014 which reportedly disputed a New York Times story revealing that James\u2019 grandniece told a grand jury she had never paid rent on the Norfolk, Va., property at the center of the case \u2014 constituted material subject to discovery requirements.<\/p>\n

James pleaded not guilty last week to one count of bank fraud and one count of making a false statement to a financial institution.<\/p>\n<\/div>\n

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