DOJ Scores First Win in Fraud Case as Judge Rejects Letitia James' Motion

Niagara Action
Nov 7
2 min read

New York Attorney General Letitia James suffered a legal setback on October 31st when a federal judge denied her attempt to force prosecutors to keep a detailed record of their media contacts in her federal mortgage fraud prosecution.

James’ legal team filed the motion last week, citing reports that U.S. Attorney Lindsey Halligan exchanged encrypted Signal messages with a journalist about the case. Defense attorney Abbe Lowell sought a court order requiring prosecutors to log every interaction with the press.

U.S. District Judge Jamar Walker rejected that request outright, writing, “[T]he defendant does not demonstrate that it is necessary for the Court to order the government to track communications with the media in any particular form.” He continued, “The defendant’s request that the government be required to keep a communication log is DENIED.”

Walker acknowledged that Halligan’s disappearing Signal messages with Lawfare senior editor Anna Bower earlier this month were “unusual,” but declined to offer an opinion “on whether they were improper in any sense, either legal or ethical.”

Instead of granting James’ request, the judge ordered prosecutors to follow normal court rules and issued a litigation hold barring the deletion of evidence, including communications related to the case. Halligan’s texts, which were set to auto-delete after eight hours, now must be preserved.

Walker also dismissed the idea that prosecutors should be required to maintain communications “in any particular form,” writing that James had not shown a need for a mandatory log.

“The defendant does not demonstrate that a communication log is necessary, so the Court will not order the government to maintain one.” He added, “The Court trusts that counsel on both sides will comply with this Order without further handholding.”

Federal prosecutors had asked Walker to impose a gag order on James herself, but the judge declined that request as well.

James pleaded not guilty to a single count of bank fraud and a single count of making a false statement to a financial institution.

According to the indictment, James secured a $109,600 mortgage on an August 17th, 2020, home purchase by signing a “second home rider” that designated her as the “sole borrower to occupy and use the property.” Prosecutors say that promise helped her get better mortgage terms, saving her nearly $19,000.

However, prosecutors allege that James never lived there. Instead, the home was used as a rental for her grandniece, Nakia Thompson.

If convicted on both counts, James faces as many as 60 years in prison and up to $2 million in fines.