Grand Jury Declines to Indict New York AG Letitia James in Revised Mortgage Fraud Case
James was first indicted on October 9, 2025, in the U.S. District Court for the Eastern District of Virginia on a single count of mortgage fraud under 18 U.S.C. § 1341, alleging she misrepresented a Virginia property as her primary residence on a 2020 loan application to secure a lower interest rate.
A federal grand jury in Norfolk, Virginia, declined to indict New York Attorney General Letitia James on December 4, 2025, after prosecutors presented revised mortgage fraud charges less than two weeks after a judge dismissed the initial case. The no-bill decision, confirmed by multiple sources familiar with the proceedings, marks a setback for the Justice Department under President Donald Trump, which had refiled the case in an attempt to overcome a ruling on improper prosecutorial appointment.
James was first indicted on October 9, 2025, in the U.S. District Court for the Eastern District of Virginia on a single count of mortgage fraud under 18 U.S.C. § 1341, alleging she misrepresented a Virginia property as her primary residence on a 2020 loan application to secure a lower interest rate. The referral originated from Federal Housing Finance Agency Director Bill Pulte in April 2025, part of a series targeting Democrats for similar residency claims. James pleaded not guilty on October 24, calling the charges "retaliatory" for her civil fraud case against Trump, which resulted in a $454 million judgment she is appealing.
U.S. District Judge Cameron Currie dismissed the indictment on November 24 in a 25-page ruling, finding Acting U.S. Attorney Lindsey Halligan's appointment violated the Appointments Clause and 28 U.S.C. § 509, as she lacked Senate confirmation or proper delegation from Attorney General Pam Bondi. Currie rejected DOJ ratification arguments, stating it could not cure the retroactive defect, echoing a D.C. Circuit decision on Special Counsel Jack Smith's appointment.
Prosecutors quickly refiled in Norfolk—still within the Eastern District—seeking a fresh indictment before a different grand jury. The panel reviewed evidence of James' 2020 loan for a $650,000 Virginia home, where she checked the "primary residence" box despite maintaining a New York address, potentially saving $10,000 in interest and taxes. Sources told Reuters and the Washington Post the grand jury deliberated for several hours before declining, citing insufficient probable cause.
James' office issued a statement: "This is nothing more than a politically motivated witch hunt, and the grand jury saw right through it." The decision halts the case for now, though DOJ officials indicated to CNN on December 4 that they could seek a third indictment or appeal the dismissal, potentially in the Fourth Circuit. Statutes of limitations for fraud (five years) expire in 2025 for the loan, pressuring swift action.
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