York
Attorney
General
Letitia
James
(Photo
by
Michael
M.
Santiago/Getty
Images)
Last
week,
Lindsey
Halligan,
the
acting/interim/special/imaginary
US
Attorney
for
the
Eastern
District
of
Virginia
indicted
New
York
Attorney
General
Letitia
James
for
mortgage
fraud,
fulfilling
a
long-held
goal
of
her
client,
Donald
Trump.
James
is
charged
with
two
felonies
relating
to
the
purchase
of
an
investment
property
in
Norfolk,
Virginia:
one
count
of
bank
fraud
in
violation
of
18
U.S.C.
§
1344,
and
one
count
of
making
a
false
statement
on
a
mortgage
application
in
violation
of
18
U.S.C.
§
1014.
As
with
the
recent
indictment
of
James
Comey,
another
Trump
nemesis,
the
James
indictment
was
so
weak
that
regular
prosecutors
—
i.e.,
ones
who
have
actually
tried
criminal
cases
—
refused
to
touch
it.
And,
as
in
Comey’s
case,
Halligan
was
the
only
lawyer
willing
to
sign
off
on
it.
So
if
conservative
commentators
and
Sam
Alito(!)
are
right,
and
her
appointment
was
unlawful,
the
case
may
get
dismissed
long
before
trial.
Meet
Virginia
Prior
to
this
indictment,
it
was
presumed
that
Halligan
would
indict
James
with
respect
to
a
different
Virginia
property.
Bill
Pulte,
head
of
the
Federal
Housing
Finance
Agency,
as
well
as
Fannie
Mae
and
Freddie
Mac,
has
been
spelunking
through
financial
records
of
Trump’s
enemies,
and
he
sent
a
criminal
referral
to
Attorney
General
James
regarding
a
house
in
Norfolk.
But
apparently
Halligan
punted
on
The
Case
of
the
Errant
Power
of
Attorney,
an
extraneous
document
which
erroneously
described
the
property
as
a
personal
residence,
when
every
other
piece
of
the
loan
application
correctly
described
it
as
a
rental.
Worst
Nancy
Drew
mystery
ever!
Instead
she
charged
James
with
lying
on
a
mortgage
application
for
a
different
house
in
Norfolk,
which
James
purchased
in
August
of
2020
for
$137,000.
She
received
a
loan
for
80
percent
of
the
purchase
price
from
Old
Virginia
Mortgage
(now
known
as
OVM
Financial),
which
she
appears
to
have
paid
off
in
2024.
According
to
the
indictment,
James
falsely
claimed
that
she
planned
to
use
the
house
as
a
second
home
in
order
to
lower
her
interest
rate
from
3.815
to
3.0
percent,
saving
herself
$17,837
over
the
four-year
life
of
the
loan.
In
a
conclusory
fashion,
but
without
providing
any
evidence,
it
states
that
James
“knowingly”
made
false
statements
on
the
loan
document.
This
has
a
certain
irony,
since
James
prosecuted
Trump
for
falsely
inflating
his
net
worth
on
mortgage
applications,
something
he
claimed
was
a
victimless
crime
so
long
as
the
lender
was
paid
in
full.
The
government
also
claims
that
the
reduced
rate
netted
James
just
over
an
extra
$1,000
in
the
seller’s
credit
at
settlement.
The
problem
is
that
the
indictment
yaddayaddayaddas
over
several
elements
of
the
supposed
crime,
which
strongly
suggests
that
it
was
done
on
purpose
because
filling
in
the
blanks
would
fatally
undermine
the
prosecution.
The
Low
Rider
Paragraph
6
of
the
indictment
alleges
that:
The
loan
was
originated
by
OVM
Financial
under
a
signed
Second
Home
Rider,
which
required
James,
as
the
sole
borrower,
to
occupy
and
use
the
property
as
her
secondary
residence
and
prohibited
its
use
as
a
timesharing
or
other
shared
ownership
agreement
or
agreement
that
requires
her
to
rent
the
property
or
give
any
person
any
control
over
the
occupancy
or
use
of
the
property.
That
language
roughly
mirrors
Fannie
Mae
Form
3890,
which
James
almost
certainly
signed
as
part
of
her
mortgage
application.
It
says:
6.
Occupancy.
Borrower
must
occupy
and
use
the
Property
as
Borrower’s
second
home.
Borrower
will
maintain
exclusive
control
over
the
occupancy
of
the
Property,
including
short-term
rentals,
and
will
not
subject
the
Property
to
any
timesharing
or
other
shared
ownership
arrangement
or
to
any
rental
pool
or
agreement
that
requires
Borrower
either
to
rent
the
Property
or
give
a
management
firm
or
any
other
person
or
entity
any
control
over
the
occupancy
or
use
of
the
Property.
Borrower
will
keep
the
Property
available
primarily
as
a
residence
for
Borrower’s
personal
use
and
enjoyment
for
at
least
one
year
after
the
date
of
this
Security
Instrument,
unless
Lender
otherwise
agrees
in
writing,
which
consent
will
not
be
unreasonably
withheld,
or
unless
extenuating
circumstances
exist
that
are
beyond
Borrower’s
control.
Plainly
the
intent
of
that
rider
is
that
the
borrower
agrees
to
“maintain
exclusive
control”
over
the
property.
So,
while
James
couldn’t
turn
the
home
into
a
time-share
or
sign
an
agreement
that
required
her
to
rent
the
property,
there
was
no
bar
to
renting
it
in
the
short
term.
That’s
why
the
rider
says
that
James
agreed
to
keep
the
property
“available
primarily
as
a
residence.”
In
fact,
Fannie
Mae
revised
this
rider
in
2019
to
make
it
clear
that
buyers
were
free
to
rent
out
their
second
homes
on
sites
like
Airbnb.
As
one
mortgage
specialist
noted
at
the
time,
the
new
rider
“explicitly”
allows
for
those
sorts
of
short-term
rentals
of
second
homes.
And
so,
even
if
James
had
rented
out
the
Norfolk
property,
she
probably
wouldn’t
have
violated
the
Fannie
Mae
rider.
But
Did
James
Even
Rent
Out
Her
Second
Home?
The
short
answer
is:
We
don’t
know.
The
indictment
says
that
James
rented
the
property
to
a
family
of
three
and
collected
“thousand(s)
of
dollars
in
rents
received.”
That
seems
deliberately
vague,
suggesting
perhaps
that
James
netted
tens
or
even
hundreds
of
thousands
of
dollars.
In
fact,
she
netted
somewhere
between
$1,000
and
$5,000,
according
to
a
2020
financial
disclosure
dug
up
by
a
“forensic
accountant”
named
Sam
Antar.
In
2023,
Antar
was
convicted
of
securities
fraud
in
connection
with
the
Crazy
Eddie
electronics
chain,
of
which
he
was
CFO.
He’s
since
rebranded
himself
as
an
“investigator
of
financial
fraud,”
presumably
on
the
theory
of
it
takes
one
to
know
one.
(Yes
that)
Roger
Stone’s
“Stone
Zone”
recently
ran
an
exposé
on
James
drafted
by
Antar
which
included
such
trenchant
observations
as:
Adding
to
the
mystery,
James
consistently
reported
this
mortgage
in
the
range
of
$100,000-$150,000
for
three
consecutive
years
(2020–2022),
but
then
in
2023,
the
reported
value
inexplicably
drops
to
$75,000-$100,000
without
explanation.
While
this
could
potentially
be
related
to
payment
of
principal,
the
absence
of
any
official
record
of
this
mortgage
in
ACRIS
[New
York’s
real
property
registration
site]
makes
it
impossible
to
verify
the
actual
terms,
origination
date,
or
even
existence
of
this
substantial
financial
obligation.
She
paid
down
her
mortgage?
Lock
her
up!
Here’s
Antar’s
smoking
gun:
Note
that
James
discloses
“rental
income”
for
a
property
in
Brooklyn,
but
describes
income
on
the
Norfolk
property
as
“investment.”
According
to
the
indictment,
James
rented
the
property
to
a
family
of
three.
But
Halligan
never
says
for
how
long,
and
she’s
pretty
hand-wavey
about
how
much
rent
James
took
in
—
two
things
she
almost
certainly
knows,
since
her
predecessor
Erik
Siebert
interviewed
multiple
witnesses
about
this
case.
Income
of
less
than
$5,000
is
consistent
with
a
short-term
rental
explicitly
permitted
by
the
Fannie
Mae
Second
Home
Rider.
And
indeed
the
second
half
of
2020,
during
the
height
of
Covid,
was
a
time
when
many
people
were
making
ad
hoc
living
arrangements.
We
simply
don’t
know
what
happened
here.
But
Lindsey
Halligan
does
know,
and
she
chose
not
to
mention
it
in
this
indictment.
In
any
event,
James
has
not
disclosed
any
income
from
the
Norfolk
property,
rental
or
otherwise,
since
2020.
The
“Crimes”
Suppose
for
the
sake
of
argument,
that
James
was
prohibited
from
renting
the
Norfolk
property
and
did
so
anyway.
The
bank
fraud
statute,
18
U.S.C.
§
1344,
makes
it
a
crime
to
“knowingly
execute”
a
“scheme
or
artifice”
to
either
defraud
a
bank
or,
more
broadly,
to
obtain
funds
from
the
bank
“by
means
of
false
or
fraudulent
pretenses,
representations,
or
promises.”
And
18
U.S.C.
§
1014
similarly
makes
it
a
crime
to
“knowingly
make[]
any
false
statement
or
report…
for
the
purpose
of
influencing
in
any
way”
a
covered
mortgage
lender.
To
convict
James,
the
government
must
not
only
prove
that
she
lied
on
the
mortgage
application,
but
that
she
did
so
“knowingly”
and
as
part
of
a
corrupt
“scheme”
to
improperly
influence
the
mortgage
lender.
Prosecutors
would
have
to
show
that
James
knew
she
was
going
to
rent
out
the
Norfolk
property
at
the
time
she
signed
the
loan
application
but
covered
up
that
fact
and
that
she
did
so
for
the
purpose
of
defrauding
the
bank
into
offering
her
a
lower
rate
of
interest
on
the
loan.
In
other
words,
if
this
case
were
to
somehow
go
to
trial,
prosecutors
would
have
to
prove
beyond
a
reasonable
doubt
that
James
concocted
a
fraudulent
scheme
in
advance
to
get
an
eight-tenths-of-one-percent
reduction
on
a
modest
loan
that
she
voluntarily
paid
off
11
years
early
…
all
so
that
she
could
earn
a
couple
thousand
dollars
in
rental
income.
When
you
say
it
out
loud,
it
doesn’t
make
much
sense.
And
it’ll
probably
make
even
less
sense
when
James
herself
starts
talking.
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