New York Attorney General Letitia James has pleaded not guilty to federal charges of bank fraud following her indictment by the Justice Department earlier this month, according to MSNBC.

On Friday (October 24), James appeared in court for her arraignment on federal bank fraud charges in Norfolk, Virginia. In the U.S., where she pleaded not guilty to the indictment. District Judge Jamar Walker, appointed to the federal bench by President Joe Biden, is presiding over the case.

According to the Justice Department indictment, James misrepresented the intended use of a home she purchased in Norfolk in 2020 to secure a lower mortgage interest rate. Prosecutors allege she claimed the property would serve as a second residence but instead rented it to a family member, making it an investment property in violation of the loan terms.

The indictment states that James purchased the home for $137,000 and borrowed $109,600, saving roughly $18,900 over the life of the loan due to more favorable lending terms and a larger seller credit.

James has called the charges “baseless,” describing the case as “a continuation of the president’s desperate weaponization of our justice system.” Her attorney, Abbe Lowell, said James “flatly and forcefully denies these charges” and suggested the prosecution is “driven by President Trump’s desire for revenge.”

In court filings Thursday (October 23), James’ legal team accused interim U.S. Attorney Lindsey Halligan, a Trump appointee, of misconduct, alleging she had an improper conversation with a journalist. The defense said it plans to seek dismissal of the indictment, arguing that Halligan’s appointment to lead the Eastern District of Virginia was unlawful.

Days before James’ indictment, the same federal prosecutor’s office charged former FBI Director James Comey with lying to Congress. Trump, who has frequently clashed with both Comey and James, had publicly urged Attorney General Pam Bondi last month to take action against them as well as Democratic Rep. Adam Schiff.

The Justice Department opened a criminal investigation into James in May over alleged mortgage fraud, later expanding the probe to include her office’s handling of the civil fraud case against the Trump Organization. That case resulted in a February 2024 ruling ordering Trump and his company to pay $354 million in fines for inflating assets to secure favorable loans. While an appellate court later overturned the fine, James is appealing that decision.

Trump named Halligan, a former White House aide, as interim U.S. attorney for the Eastern District of Virginia last month after firing her predecessor, Erik Siebert. Since Halligan’s appointment, several prosecutors have reportedly resigned or been dismissed from the office, including two who opposed the case against James.

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