Trump Administration Accuses James of Falsifying Records to Secure Favorable Loan Terms

Date: April 16, 2025

NEW YORK — New York Attorney General Letitia James, a prominent figure known for her legal battles against former President Donald Trump, is now at the center of controversy following a federal criminal referral accusing her of mortgage fraud. The referral, issued by the Federal Housing Finance Agency (FHFA), alleges that James falsified property records and residency status to obtain government-backed loans and more favorable mortgage terms for properties in Virginia and New York.

The accusations, detailed in a letter from FHFA Director William Pulte to U.S. Attorney General Pam Bondi and Deputy Attorney General Todd Blanche, focus on two key claims. First, in August 2023, James purchased a $240,000 single-family home in Norfolk, Virginia, with a $219,780 mortgage, declaring it her “principal residence” despite being required by New York law to maintain primary residency in the state as attorney general. Mortgage documents, signed via power of attorney by her relative Shamice Thompson-Hairston, stipulated that James intended to occupy the property within 60 days and maintain it as her primary residence for at least one year. Pulte argues this misrepresentation allowed James to secure a lower interest rate, as primary residence mortgages typically carry rates 25 to 50 basis points lower than those for secondary homes.

Second, Pulte alleges that James misrepresented a Brooklyn property purchased in February 2001 as a four-unit dwelling, when it was actually a five-family home, in building permits and mortgage applications spanning two decades. By listing the property as four units, James may have qualified for conforming loans with better interest rates under the federal Home Affordable Modification Program, potentially reducing her mortgage rate by up to 1%.

The referral also cites older allegations, claiming that in 1983 and 2000, James and her father signed mortgage documents listing themselves as “husband and wife” to secure a home loan. While Pulte acknowledges the age of these claims, he argues they raise “serious concerns” about the validity of James’ mortgage representations.

James, who has not been charged with any crime, has denied the allegations. A spokesperson for her office stated, “Attorney General James is focused every single day on protecting New Yorkers, especially as this Administration weaponizes the federal government against the rule of law and the Constitution. She will not be intimidated by bullies — no matter who they are.” The statement frames the referral as a politically motivated attack, pointing to James’ history of legal actions against Trump, including a 2022 civil fraud lawsuit that resulted in a $454 million judgment against him and the Trump Organization for inflating asset values to secure better loan terms.

The timing of the referral has fueled accusations of retribution. It came one day after Trump posted on Truth Social, calling James a “totally corrupt politician” and a “wacky crook” who should resign immediately. James, who has led multiple lawsuits against the Trump administration in 2025, including challenges to federal funding cuts and insider trading allegations, has been a frequent target of Trump’s ire. Legal experts note the irony of the accusations, given James’ prosecution of Trump for similar financial misrepresentations. George Washington University law professor Jonathan Turley described the situation as “perfectly crushing,” stating, “Either it’s your principal residence or it’s not.”

Former federal prosecutor Neama Rahmani highlighted potential legal risks for James, noting that New York law considers an elected office vacant if the officeholder moves their residence out of state. Rahmani also suggested the Virginia property declaration could trigger federal investigations into mortgage or tax fraud, as primary residences often qualify for lower rates and tax benefits. However, New York City trial attorney Nicole Brenecki cautioned that while the allegations may not affect James’ Trump-related cases, they could carry significant political consequences, with critics likely to accuse her of hypocrisy.

The Department of Justice has not confirmed whether it will pursue an investigation, with Attorney General Bondi stating she had only recently learned of the referral. Legal analysts point out that proving fraud requires evidence of intentional misrepresentation, and statutes of limitations may limit the scope of any prosecution, particularly for older claims like the 1983 and 2000 documents.

The referral has sparked polarized reactions. Conservative media and Trump supporters on X have celebrated the allegations as “poetic justice,” with some calling for James’ homes to be seized. Conversely, James’ allies, including New York Governor Kathy Hochul, have accused the Trump administration of targeting political adversaries, with Hochul remarking, “He’s finally gotten down to maybe the J’s on his list—Tish James.”

As the controversy unfolds, James remains steadfast, continuing her legal challenges against the Trump administration. The referral, while not a formal charge, has cast a shadow over her tenure and intensified the ongoing feud between New York’s top prosecutor and the Trump administration. Whether the allegations lead to legal consequences or remain a political flashpoint, they underscore the deepening divide in a highly charged political landscape.