Politics
NEW: Dems Introduce ‘Bailout’ For NY AG Letitia James Amid Fraud Allegations
Taxpayers could be forced to fund New York Attorney General Letitia James’ legal bills stemming from real estate fraud allegations levied by a Trump Administration official, according to a report from the New York Post.
Democrats in the state legislature are expected to sign off on a provision allowing certain official to use up to $10 million in funds to cover “any reasonable attorneys’ fees and expenses incurred,” even if the conduct in question is directly related to their state employment.
The language has been quietly slipped into New York’s operations budget bill, The Post reported. Lawmakers are expected to soon vote on a number of budget proposals that will be made public as early as Wednesday as the legislature works to pass next year’s fiscal plan.
Multiple sources told the outlet that specific language in the bill would apply to James’ looming legal fight.
The attorney general was recently accused of mortgage fraud by Federal Housing Finance Agency (FHFA) Director William Pulte in a criminal referral to the U.S. Department of Justice.
James is accused of listing a Virginia property she purchased in 2023 as her “principal residence” despite serving as attorney general of New York at the time. New York requires its attorneys general to live in the state for five years before running for office, and requires them to reside there during their tenure
The letter further revealed that James previously purchased a Brooklyn home in 2001, but has “consistently misrepresented the same property as only having four units in both building permit applications and numerous mortgage documents and applications,” Pulte noted. This could have allowed James to receive a lower mortgage rate and led to lower payments under the federal Home Affordable Modification Program (HAMP).
New York, NY – March 13, 2025: New York Attorney General Letitia James makes an announcement about new legislation to protect consumers and small businesses at AG office
New York Republican State Committee Chairman Ed Cox described the move to insert a “bailout” for James in the state’s budget plan as an “outrageous abuse of power and a slap in the face to every New Yorker.”
“This is what corruption looks like in plain sight: political insiders rigging the system to protect their own, while hardworking families get shortchanged,” he said in a statement to the New York Post. “Tish James used her office to wage partisan lawfare against her political opponents, and now New Yorkers are footing the bill for the consequences.”
Under New York law, current and former state employees can be reimbursed for legal fees to defend themselves against lawsuits directly related to their work while in office. In one recent example, former Governor Andrew Cuomo’s numerous legal battles cost taxpayers an estimated $60 million.
The language in the bill appears to have been directly inserted as a result of the potential case against James, however, as it is specifically geared towards state employees subjected to “discriminatory or retaliatory treatment” by the federal government.
While the bill does not mention James specifically, it indicates state employees could be covered if the “legally compulsive process” was initiated after January 1, 2025, after Trump was elected.
The bill would cover those who “obtained representation by private counsel in response to any request, summons, command, subpoena, warrant, investigative interview or document request, audit or legally compulsive process” initiated by the federal government as a result of state employment functions.
Abe Lowell, a high-powered attorney who is representing James, denied the allegations in a letter to Attorney General Pam Bondi last month.
“The stunning hypocrisy of President Trump’s complaint that the Justice Department had been ‘politicized’ and ‘weaponized’ against him is laid bare as he and others in his administration are now asking you to undertake the very same practice,” Lowell wrote. “This so-called ‘criminal referral,’ which recycles long-disproven allegations and is ‘(b)ased on media reports’ lacks any credible foundation.”
