Grand jury again declines to indict Letitia James on mortgage fraud charges

A federal grand jury has declined to indict Letitia James, the New York attorney general, on mortgage fraud charges for the second time in a week, according to a person familiar with the matter, in an embarrassing blow to the Trump justice department as the president has sought retribution against one of his political rivals.

The department has attempted to twice file new charges against James after a judge dismissed an indictment against her after determining the prosecutor handling the case had not been properly appointed.

A decision by a federal grand jury is extremely rare. Only prosecutors appear before a grand jury and defendants do not to offer evidence in their support of their case. There is a legal axiom that “any good prosecutor can get a grand jury to indict a ham sandwich”, underscoring the power prosecutors have over grand juries.

The justice department declined to comment.

“For the second time in seven days, the Department of Justice has failed in its clear attempt to fulfill President Trump’s political vendetta against Attorney General James. This unprecedented rejection makes even clearer that this case should never have seen the light of day,” said Abbe Lowell, a lawyer representing James. “This case already has been a stain on this Department’s reputation and raises troubling questions about its integrity. Any further attempt to revive these discredited charges would be a mockery of our system of justice.”

James was charged with one count of bank fraud and one count of making a false statement in connection with a home in Norfolk, Virginia in 2020. Prosecutors say James committed a crime because she indicated on mortgage paperwork that the purchase would serve as her second home, but then rented it out. James denies wrongdoing and experts have said the allegations are thin. The New York Times reported James’ niece lives in the home.

Career prosecutors did not think there was sufficient evidence to file charges against James and were subsequently fired. The initial case was personally presented by Lindsey Halligan, a Trump ally installed to be the acting US attorney for the eastern district of Virginia. In November, a federal judge dismissed the case after ruling that Halligan was improperly appointed to the post. The criminal case against James Comey, the former FBI director, was dismissed on similar grounds.

Nothing prevented the justice department from trying to refile the case and they did so last week before a federal grand jury in Norfolk. A career attorney brought in from Missouri to work on the case, Roger Keller, handled that presentation, which was rejected. The office could again seek to refile charges against James with a different grand jury.