NORFOLK, Virginia — New York Attorney General Letitia James entered a not guilty plea on Friday in federal court, facing charges of bank fraud and making false statements to a financial institution. The high-profile case, pushed by former President Donald Trump, has sparked a legal and political battle that highlights concerns over the potential weaponization of the U.S. justice system.

James’ first court appearance in Norfolk, Virginia, comes after a tumultuous legal history between her and Trump, including a landmark civil fraud case she brought against the former president and the Trump Organization. Outside the courthouse, James told supporters that the indictment was part of “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.”

Allegations in the Mortgage Fraud Case

Federal prosecutors allege that James misrepresented the intended use of a Norfolk, Virginia, home she purchased in 2020. The mortgage loan required the property to serve as a secondary residence, prohibiting shared ownership or timesharing. However, the indictment claims the property was rented to a family of three, allowing James to obtain loan terms favorable for a secondary residence but unavailable for an investment property.

James’ attorneys argue that the charges are politically motivated and plan to file motions to dismiss the case as a “vindictive prosecution” directed by Trump. A trial date has been set for January 26, 2026.

Controversy Over U.S. Attorney Lindsey Halligan

The case is further complicated by questions over the legitimacy of U.S. Attorney Lindsey Halligan’s appointment. Halligan, a former Trump personal attorney with no prosecutorial experience, was appointed after the resignation of Erik Siebert, the previous U.S. Attorney who reportedly expressed doubts about the strength of evidence in James’ case. Halligan independently presented James’ indictment to a grand jury, bypassing career prosecutors in the office.

James’ legal team plans to ask a federal judge to dismiss the charges, arguing Halligan’s appointment was unlawful. Former FBI Director James Comey is also challenging Halligan’s appointment in a separate case, with oral arguments scheduled for November 13 in Alexandria, Virginia, before a South Carolina federal judge to avoid conflicts of interest. These challenges may be consolidated, as has occurred in other districts where defendants contested politically appointed U.S. attorneys.

Political Context and Broader Implications

James’ prosecution is the latest in a series of federal cases involving Trump critics. Other notable figures facing charges include Comey, charged with lying to Congress, and former National Security Adviser John Bolton, accused of mishandling classified information. Trump has publicly advocated for the prosecution of his political opponents, calling on then-Attorney General Pam Bondi to act against James, Comey, and others, citing concerns about national credibility.

Legal experts have warned that these prosecutions may erode public trust in the impartiality of the justice system. James’ lawyers have also sought court orders preventing prosecutors from sharing case details with the media, following reports that Halligan contacted a reporter via encrypted messaging to discuss the case.

James’ Defense and Public Response

Despite the high stakes, James appeared confident outside the courthouse, thanking supporters and emphasizing her belief in the rule of law. “My faith is strong, and I have this belief in the justice system and the rule of law, and I have a belief in America,” she said.

James, the first woman elected as New York Attorney General, has previously pursued high-profile cases against Trump, including a civil fraud lawsuit that initially resulted in a $500 million judgment—later overturned on appeal—but affirmed that Trump was liable for falsifying financial records.

Her legal team argues that this criminal case is not about wrongdoing but about political retaliation, framing it as part of a broader pattern of Trump’s alleged efforts to use federal law enforcement as a tool of personal retribution.

Key Takeaways

• Letitia James faces federal charges for mortgage fraud related to a Norfolk, Virginia home purchased in 2020.
• She plans to challenge the legitimacy of U.S. Attorney Lindsey Halligan’s appointment, arguing the case is politically motivated.
• Trump’s public calls for prosecution of political opponents, including James, have intensified concerns over potential misuse of the justice system.
• The case is part of a wider pattern of legal scrutiny against Trump critics, including James Comey and John Bolton.
• James’ trial is set for January 26, 2026, with motions to dismiss expected to be argued in the coming months.