New York AG Letitia James pleads not guilty to mortgage fraud charges
New York Attorney General Letitia James, appearing in a federal courtroom in Norfolk, Virginia, pleaded not guilty Friday to charges of alleged mortgage fraud, after she was indicted earlier this month by President Donald Trump's handpicked U.S. attorney.
James pleaded not guilty to one count of bank fraud and one count of making false statements to a financial institution.
"Not guilty, judge, to both counts," James said, entering the plea herself.
U.S. District Judge Jamar Walker set an initial trial date for Jan. 26, to which both the government and the defense agreed.
The trial is expected to take "no more" than two weeks, said government attorneys, who estimated they will call between 8 to 10 witnesses.
James was released on personal recognizance following the conclusion of the hearing.
Interim U.S. Attorney Lindsey Halligan -- who Trump appointed just days after calling on the his attorney general to act "NOW!!!" to prosecute James and other political enemies -- secured the indictment against James on Oct. 9. James successfully brought a civil fraud case against Trump last year and currently leads multiple lawsuits challenging his administration's policies.
Halligan was named U.S. attorney by Trump after Trump ousted her predecessor, Erik Siebert, who sources say had expressed doubts internally about bringing cases against James and former FBI Director James Comey.
After attorneys representing James filed a motion challenging Halligan's appointment as unlawful, Judge Walker ordered that the motion be consolidated with the already ongoing effort to disqualify her in the case against Comey, who was indicted last month on charges of making false statements to Congress, to which he has pleaded not guilty.
Both James' attorneys and the Justice Department supported the idea of consolidating the challenges, which will be considered by an out-of-district judge already appointed this week.
James, speaking outside the courthouse following her arraignment, said the justice system under President Trump has been "used as a tool of revenge" and is nothing but a "vehicle of retribution."
"I want to thank you for your support," James said. "But this is not about me. Yes, this is about all of us. Yeah. And about our justice system, which has been weaponized. Against a justice system, which has been a tool been used as a tool of revenge."
"But my faith is strong. And my faith is, I have this belief in the justice system, in the rule of law," James said.
Judge Walker, during the hearing, also briefly discussed a motion from James' attorneys ordering Halligan to make no more extrajudicial disclosures to the media following revelations that she sent Signal messages to a reporter about James' case earlier this week.
Judge Walker noted there was no request to sanction Halligan for the messages, and Roger Keller, the DOJ prosecutor, said that if a requirement was placed on the government to keep a log of Halligan's discussions with the media then a similar requirement should be made of James given her statements to the media.
James' attorney Abbe Lowell argued there was a major difference between James voicing public statements under her First Amendment rights and Halligan having discussions about a case with a reporter over an encrypted application with a deletion schedule.
Judge Walker set a deadline of Nov. 1 for James to make her first filing on her claim of vindictive prosecution.
The charges James faces accuse her of committing mortgage fraud related to a home she purchased in 2020.
According to the indictment, James falsely described the property as a second home to get an advantageous mortgage rate, but used it as an "investment property," rented to a family of three. The indictment alleged James collected thousands of dollars in rent and would have saved $17,837 over the life of the mortgage versus a loan at a higher rate.
"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 announcing the charges. "The facts and the law in this case are clear, and we will continue following them to ensure that justice is served."
But in an internal memo to Siebert in September, prosecutors said James purchased the home in Norfolk, Virginia, for her great-niece and immediately allowed her and her children to begin living in the house rent-free, sources told ABC News. Prosecutors met with James' niece, who stated that she had never signed a lease, had never paid rent for the home, and that James had often sent her money to cover some of the expenses, the memo concluded, according to sources familiar with its contents.
James' indictment on Oct. 9 came between the indictments of Comey and former Trump national security adviser John Bolton amid what critics call Trump's campaign of retribution against his perceived political foes.
Vice President JD Vance has said any such prosecutions are "driven by law and not by politics."
If convicted, James faces a maximum of up to 30 years in prison per count, up to a $1 million fine on each count, and forfeiture of the property.
