Norfolk, Virginia — New York Attorney General Letitia James pleaded not guilty Friday to federal charges of bank fraud in Norfolk, Virginia, after the Justice Department indicted her earlier this month.
“Not guilty, Judge, to both counts,” James told U.S. District Judge Jamar Walker, appointed to the federal bench by former President Joe Biden, who is presiding over the case.
A trial in James’ case is set to begin Jan. 26, though that could change. Walker said the proceedings should last roughly five days. James was released on her own recognizance.
In remarks outside the courthouse after the proceeding, James thanked supporters — who were chanting “we stand with you” and had gathered for her arraignment. She said their support “strengthened my spirit.”
“This is not about me. This is about all of us and about a justice system which has been weaponized, a justice system which has been used as a tool of revenge … and a weapon against those individuals who simply did their job and who stood up for the rule of law, and a justice system which unfortunately is being used as a vehicle of retribution,” she said.
“But my faith is strong and my faith is … I have this belief in the justice system and the rule of law, and I have a belief in America,” James said.
Jonathan Ernst / REUTERS
The New York attorney general said she has heard from people across the country urging her to remain strong.
“There’s no fear today, no fear,” James said. “Because I believe that justice will rain down like water and righteousness like a mighty stream, and I’m here to say that my work and my job and all that I do all throughout my public career — I’ve stood up for the rights of New Yorkers and Americans and I will not be deterred … I will not be distracted. I will do my job each and every day.”
James’ lawyer, Abbe Lowell, said during the arraignment that he will seek to have the charges against James tossed out on several grounds, including vindictive and selective prosecution, and that the indictment does not allege appropriate charges.
The judge set hearings on those motions for December.
The indictment alleges that James misrepresented how she would use a house she bought in Norfolk in 2020, in order to obtain a lower interest rate on her mortgage. Instead of using the property as a second home, the indictment says, she rented it to a family member, treating it as an investment property, in contravention of the mortgage terms.
According to the indictment, James purchased the home for $137,000 and borrowed $109,600 — and because she received more favorable lending terms and a larger seller credit, she allegedly saved $18,933 over the life of the loan.
James called the charges “baseless” in a video statement.
“This is nothing more than a continuation of the president’s desperate weaponization of our justice system,” she said.
James’ attorney, Abbe Lowell, said James “flatly and forcefully denies these charges” and said he is “deeply concerned that this case is driven by President Trump’s desire for revenge.”
In a pair of legal filings Thursday, James’ legal team took aim at the Trump-appointed prosecutor overseeing her bank fraud case, accusing interim U.S. attorney Lindsey Halligan of an improper conversation with a journalist and vowing to seek dismissal of the indictment on the grounds that Halligan was unlawfully named to the job.
Shortly after the proceeding ended, Lowell filed his bid to have the indictment dismissed on the grounds that Halligan’s appointment as interim U.S. attorney was invalid and unconstitutional. He’s also seeking a court order that would block Halligan from supervising the prosecution of James’ case and exercising any other duties as interim U.S. attorney.
Halligan, he wrote, “had no authority to litigate this case on behalf of the United States.”
“[B]ecause this indictment would not have been sought or obtained absent Ms. Halligan’s unlawful appointment … the indictment’s flaws cannot be brushed aside as harmless error,” Lowell wrote. “This Court must reject the Executive Branch’s brazen attempt to sidestep the constitutional and statutory limitations on the appointment of U.S. Attorneys.”
Days before James was indicted, a grand jury impaneled by the same federal prosecutor’s office handed up an indictment against former FBI Director James Comey, on charges of lying to Congress, with whom Mr. Trump clashed during his first term. Comey is also seeking to have the charges against him tossed out on the basis that Halligan’s appointment as interim U.S. attorney is invalid and unlawful.
A hearing on those efforts in both Comey and James’ cases will be held Nov. 13 in the federal courthouse in Alexandria, Virginia, before South Carolina federal judge Cameron Curry.
Last month, Mr. Trump publicly urged Attorney General Pam Bondi to take action against Comey and James, as well as Democratic Sen. Adam Schiff of California, another vocal critic of his administration.
The Justice Department launched a criminal probe into James in May regarding mortgage fraud. Three months later, it expanded its investigation into the Office of the New York Attorney General’s handling of the Trump Organization probe.
In February 2024, the state of New York won a civil fraud judgment against Mr. Trump and the Trump Organization for $354 million in fines for submitting what the judge said was “blatantly false financial data” to accountants in order to borrow more money at more favorable interest rates.
The ruling also barred the Trump Organization from seeking loans from financial institutions in New York for three years and also banned Mr. Trump from serving as an officer or director of any New York corporation for three years. An appellate court erased the fine in August, but James is appealing the ruling. The court kept the other sanctions in place, however.
Mr. Trump announced last month that he had selected Halligan, a former White House aide, to temporarily lead the U.S. Attorney’s Office in the Eastern District of Virginia after the abrupt ouster of the prosecutor he had originally named to the post, Erik Siebert.
Sources told CBS News that Halligan presented evidence to the Comey and Letitia James grand juries alone, rather than with line prosecutors who had worked on the cases. Since Halligan became the interim U.S. attorney for the Eastern District of Virginia, several prosecutors have left the office or been fired.
Two federal prosecutors in the office, Kristin Bird and Elizabeth Yusi, were terminated last week from their posts as assistant U.S. attorneys in the Norfolk office after they voiced opposition to the criminal case against James. The office’s top national security official, Michael Ben’Ary, was also terminated in recent weeks.
As a result of the turnover, two North Carolina federal prosecutors have been brought in to handle the Comey case, and a federal prosecutor from Missouri will be presenting the James case.