New York Attorney General Indicted Over Allegations of Mortgage Fraud
New York Attorney General Letitia James has been indicted for allegedly obtaining a favorable mortgage loan by misrepresenting the purpose of a home she purchased in Virginia, which was reportedly used to shelter a relative currently listed as a fugitive.
In 2020, James acquired a three-bedroom house in Norfolk, Virginia, categorizing it as an “investment” in her financial disclosures for 2020 through 2023, with its value estimated between $100,000 and $150,000. However, in her 2024 disclosure, she reclassified the property as “real property” instead of an investment.
A month before filing her 2024 disclosure in May, Federal Housing Finance Agency Director William Pulte had already referred her case to the U.S. Department of Justice, alleging that records were falsified to secure home loans in Virginia.
Prosecutors claim James incorrectly classified her use of the property when she secured a $109,800 mortgage for the $137,000 home. The indictment notes that she agreed to a “Second Home Rider,” which stipulates that the property must be used as a secondary residence for personal use, rather than as a rental or primary residence.
“Despite these representations,” prosecutors asserted, the Norfolk property “was not occupied or used by James as a secondary residence and was instead used as a rental investment property.”
This misrepresentation allowed her to qualify for a mortgage rate that wouldn’t have been available had she disclosed her intent to use the home as a rental, according to the Justice Department. The lower rate reportedly resulted in “approximately $18,933 over the life of the loan.”
Furthermore, James provided inaccurate information on a homeowner’s insurance application, stating that the home would be “owner-occupied.” According to her federal tax forms, she treated the property as “rental real estate,” reporting significant rental income and claiming deductions for related expenses.
She faces charges for bank fraud and making false claims to a financial institution. If found guilty on both counts, she could face a maximum of 60 years in prison and fines reaching up to $2 million. James is scheduled for her initial court appearance in Virginia on October 24.
Since 2020, James’ grandniece, Nakia Thompson, has resided in the Virginia home. Thompson, who is 36, is considered a fugitive for having absconded from North Carolina after violating parole from a 2011 felony conviction. Her criminal history includes charges for assaulting a government official and resisting a public officer.
In Virginia, Thompson has faced multiple charges, including possession of burglary tools and grand larceny. In 2020, she received a $2,020 fine after pleading guilty to various theft charges and was sentenced to two years of probation. Additionally, numerous traffic offenses have also been attributed to her, including speeding and improperly stopping on a highway.
The mortgage agreement from August 17, 2020, explicitly forbids any “shared ownership arrangement” for the property, specifying that James must maintain “exclusive control” over it.
