The Times Union reported that the FBI and the U.S. Attorney’s Office in Albany opened a case against New York Attorney General Letitia James for alleged mortgage fraud.
James is a New York elected official who is located in Albany, but the alleged fraud occurred in New York City.
The Times Union pointed out that some of the alleged fraud “also may fall outside the federal statute of limitations, although one of the mortgages involves James’ assertions in loan documents related to her 2023 purchase of a residence in Virginia.”
President Donald Trump’s administration referred James to the DOJ in mid-April.
“Based on media reports, Ms. Letitia James has, in multiple instances falsified bank documents and property records to acquire government backed assistance and loans and more favorable loan terms,” wrote Bill Pulte, director of Federal Housing Finance Agency (FHFA), to Attorney General Pam Bondi.
Pulte added: “This has potentially included 1) falsifying residence status for a Norfolk, Virginia-based home in order to secure a lower mortgage rate and 2) misrepresenting property descriptions to meet stringent requirements for government backed loans and government assistance.”
James’s office hired Abbe Lowell (the same person who represented Hunter Biden), who accused Trump of weaponizing the DOJ “by targeting James as part of a campaign of ‘political retribution’ for the investigations her office has conducted into his business dealings.”
However, the Times Union pointed out that documents about James’s transactions “have been circulated since last year to various news outlets and elected officials by a man using a fictitious name.”
The man said he belonged to a group that started examining James’s records “after a friend had committed suicide while under investigation by the attorney general’s office for mortgage fraud.”
The man used a phone number “listed as a contact number in a legal notice two years ago for a Long Island man who is being actively prosecuted by the state attorney general’s office for fraud.”
In mid-August 2023, James allegedly gave someone power of attorney to establish the Virginia property as her “principal residence.”
At the end of the month, James purchased the property through her attorney.
“In a Fannie Mae/Freddie Mac Form 3047 and in mortgage documents, she reaffirmed this would be her primary residence, despite being a statewide public office holder in the state of New York at that same time and primarily residing in New York,” explained Pulte.
Pulte reminded Bondi that “[P]rimary residence mortgages receive more favorable loan terms, including lower interest rates, than secondary residence mortgages” since those are considered “significantly riskier.”
Pulte references an article White Collar Fraud published about the Virginia residence.
The second property in the letter is a five-family dwelling in Brooklyn, NY.
Pulte accused James of consistently misrepresenting the property as a four-family unit. Why is that? James received “a conforming loan through the Freddie Mae/Freddie Mac Form 3033,” which is only available for buildings with four or fewer units.
“Conforming loans, or Fannie Mae and Freddie Mac-backed mortgages, have favorable rates and terms to traditional private market mortgages for the explicit purpose of availability to lower and middle-income borrowers,” stated Pulte.
According to Pulte, any building with more than four units is considered a multifamily property, requiring “a larger down payment and high interest rate terms.”
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