OAN Staff Brooke Mallory
2:36 PM – Thursday, May 8, 2025
A source familiar with the investigation informed the press that the FBI and the U.S. Attorney’s Office in Albany, New York, have initiated a criminal probe into allegations of mortgage fraud involving New York Attorney General Letitia James—who previously sought to prosecute President Donald Trump on multiple criminal charges.
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The inquiry, which was initially published by the Albany Times Union, comes after Federal Housing Finance Agency Director William Pulte requested last month that the Justice Department (DOJ) look into James.
Pulte’s referral was directed to the Northern District of New York, which is headed by U.S. Attorney John Sarcone III.
The FBI and Albany prosecutors were praised by Rep. Elise Stefanik (R-N.Y.), who represents the district where the inquiry was started.
“The investigation into Letitia James is a vital step toward justice,” Stefanik said in a statement. “I will continue to fight to expose NY corruption, protect constitutional rights, and hold these failed Democrat leaders in NY accountable.”
According to Pulte’s letter, James “falsified records” in order to secure favorable loans for a Brooklyn brownstone she has owned since 2001 and a Virginia property she bought in 2023. A brownstone is a type of townhouse, typically characterized by its red-brown sandstone facade, grand stoops, and tall windows, found primarily in historic urban neighborhoods.
In addition, the Democrat purportedly overstated the number of units in her Brooklyn home and stated that the Virginia house would be her “principal residence” while serving as New York’s top police officer.
“Ms. James, for both properties listed above, appears to have falsified records in order to meet certain lending requirements and receive favorable loan terms,” Pulte told Attorney General Pam Bondi.
Criminal charges, such as wire fraud, mail fraud, bank fraud, and making false representations to a financial institution, could result from that — Pulte continued.
Requests for comment on Thursday were not immediately answered by the FBI or the U.S. Attorney’s Office in Albany.
She has previously called the accusations “baseless” and asserted that the president was using the referral as part of a “revenge tour” after she filed civil fraud charges against him and his business, the Trump Organization.
During her 2019 probe into Trump, which resulted in a $454 million judgment against him and his real estate company, James ironically declared that “no one is above the law.”
Abbe David Lowell, one of Hunter Biden’s most prominent attorneys, has now been hired by the New York AG’s Office to serve as special counsel. According to a Times Union report, Lowell was hired by the attorney general’s office rather than by James in her individual role, meaning that the cost of his pricey legal services will ultimately be paid by New York taxpayers.
Additionally, a clause establishing a $10 million slush fund that state officials can use to pay for “any ‘reasonable’ attorneys’ fees and expenses incurred,” including for investigations unrelated to their jobs, is anticipated to be approved by Democrats in Albany — while locals question why their hard-earned dollars are being taken advantage of.
Nonetheless, a representative for James’ office told the New York Post on Wednesday that she intends to fight the issue using both state funding and a private legal defense fund.
The mortgage fraud accusations, according to Lowell’s scathing letter to Bondi last month, were merely a baseless attack in Trump’s “revenge tour” against the state’s top prosecutor.
“These baseless and long-discredited allegations, put to rest by my April 24 letter to the Department of Justice, are suddenly back in the news just days after President Trump publicly attacked Attorney General James,” Lowell said in the statement on Thursday.
“This appears to be the political retribution President Trump threatened to exact that AG Bondi assured the Senate would not occur on her watch. If prosecutors are genuinely interested in the truth, we are prepared to meet false claims with facts.”
Last month, America First Legal (AFL), a legal watchdog group aligned with the Trump administration, lodged a formal complaint against Attorney General Letitia James with the Committee on Professional Standards of the New York State Unified Court System, the body responsible for overseeing disciplinary matters concerning licensed attorneys within the state.
“If Ms. James has engaged in fraud by deceiving her lenders and the government to obtain financial benefits she would otherwise not be entitled to, then she has engaged in professional misconduct and violated her obligations as a lawyer and is subject to discipline by the New York Bar,” AFL’s letter states.
Key Allegations Against Trump by James
In September 2022, James filed a civil lawsuit against Trump, the Trump Organization, and several executives, including his adult children. The lawsuit alleges that from 2011 to 2021, they engaged in persistent and repeated fraud by:
- Falsely inflating and deflating asset values on financial statements to obtain favorable loan terms, insurance coverage, and tax benefits.
- Issuing false financial statements that misrepresented Trump’s net worth by billions of dollars.
- Falsifying business records and making materially inaccurate statements to financial institutions.
- Committing insurance fraud by submitting false information to insurers.
- Conspiring to commit these fraudulent acts, violating multiple provisions of New York law.
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