New York Attorney General Letitia James is under increasing scrutiny following allegations of mortgage fraud, which have sparked political controversy and calls for investigation.
In April 2025, the Federal Housing Finance Agency (FHFA) referred James to the U.S. Department of Justice, alleging she misrepresented her primary residence status to obtain favorable mortgage terms on properties in Virginia and Brooklyn. Specifically, the FHFA claims James falsely declared a Norfolk, Virginia property as her primary residence in August 2023, despite her role as New York’s Attorney General requiring her to reside in the state. Additionally, the agency alleges she misrepresented a Brooklyn investment property as having four units instead of five, potentially securing more favorable loan conditions.
James has denied these allegations, asserting they are politically motivated. Her attorney, Abbe Lowell, contends that any discrepancies were clerical errors and that the accusations stem from a campaign of retaliation led by former President Donald Trump, whom James has previously prosecuted. Lowell emphasized that documentation indicates James did not intend to reside at the Virginia property, which was being purchased by her niece.
The controversy has galvanized political opponents. Republican Michael Henry, who previously ran against James in 2022, is preparing for a rematch in the 2026 election. Henry has criticized James for what he describes as a politically partisan office and has pointed to the mortgage fraud allegations as evidence of misconduct.
Further complicating matters, a Trump-aligned watchdog group, America First Legal, has filed a complaint with New York’s Committee on Professional Standards, echoing the FHFA’s allegations and calling for a state investigation into James’s conduct, as some news websites reported.
James’s office has not commented publicly on the allegations, deferring to Lowell’s statements. The Department of Justice is currently reviewing the FHFA’s referral.
This situation unfolds against the backdrop of James’s high-profile legal actions against Trump, including a $454 million civil fraud judgment against him and his organization, which is currently under appeal.
As the 2026 election approaches, the outcome of these investigations and the political ramifications for James remain to be seen.
