Letitia James Asks Judge to Toss Bank-Fraud Indictment, Calls Prosecution 'Outrageous Government Conduct'

New York Attorney General Seeks Dismissal of October Indictment

New York Attorney General Letitia James filed a motion Monday asking a federal judge to dismiss her October bank-fraud indictment with prejudice, arguing the prosecution amounts to "outrageous government conduct" and is politically motivated. In a 22-page filing, James' lawyers say the charges are "patently unconstitutional" and were intended to punish her for opposing former President Donald Trump.

Allegations and Background

The indictment accuses James of misrepresenting a Virginia property as a second home rather than a rental to obtain a lower mortgage rate. James denies any wrongdoing and seeks a ruling that would prevent the case from being refiled.

Claims Against Officials

The filing alleges "months of illegal and unethical behavior" by three officials involved in the probe: FHFA Director Bill Pulte, Justice Department official Ed Martin and interim U.S. Attorney Lindsey Halligan.

"If this brazen, continuous disregard for the law and the Constitution is not outrageous government conduct, nothing is," James' lawyers wrote.

James' team claims Pulte—whose agency oversees Fannie Mae and Freddie Mac—transformed his oversight role into a political weapon, citing internal Fannie Mae messages in which employees questioned whether the evidence met a "clear and convincing" standard. The filing also raises questions about the origin of the information that triggered the probe, suggesting it may have come from a "fringe blogger," purchased county records, or unlawfully accessed loan files.

According to the motion, Pulte sent a private letter summarizing information about James' properties to Halligan, and prosecutors relied on some of that material in grand jury proceedings. The filing also notes that Pulte has referred other prominent Democrats to prosecutors on mortgage-fraud allegations.

The brief criticizes Ed Martin, the U.S. Pardon Attorney assigned as a special attorney for mortgage fraud, for a letter his office allegedly sent in August urging James to "resign from office" or face prosecution. James' lawyers say that letter violated Justice Department rules and professional ethics. They also point to a photograph of Martin taken outside James' Brooklyn home, which the filing describes as an apparent intimidation tactic.

The motion challenges Lindsey Halligan's role, noting that both James and former FBI Director James Comey have argued Halligan's appointment in the Eastern District of Virginia was unlawful and that the indictments represent vindictive prosecutions driven by President Trump's animus toward both figures.

Civil Case Context

The filing recalls James' 2022 civil suit accusing Mr. Trump and his company of inflating property values to obtain favorable loans. A judge awarded more than $350 million plus interest in that case, a figure later described as "excessive" by a New York appellate court, which struck that specific dollar judgment. Mr. Trump has denied the civil allegations.

The filing says the Justice Department and the FHFA were contacted for comment. The motion asks the court to dismiss the indictment with prejudice on due-process grounds, arguing the pretrial process itself has been used as punishment.