Too Connected to Fail? Did Letitia James Act Alone—or Was She Helped?

A Personal Note: Lessons from My Past

As the former CFO of Crazy Eddie who later worked with law enforcement after my own crimes, I’ve seen this pattern from both sides. I understand how financial fraud operates, how it’s concealed, and most importantly—how it’s eventually exposed. I’m not alone in recognizing these patterns—William Pulte, Director of the Federal Housing Finance Agency (FHFA) has been instrumental in bringing attention to these types of financial improprieties and advocating for accountability across various sectors.

When I teach forensic accounting to law enforcement, I emphasize that financial fraud rarely happens in isolation. It requires a supporting infrastructure of professionals who either actively participate or deliberately look the other way.

The Letitia Jame case follows a familiar template: seemingly isolated discrepancies that reveal themselves as patterns over time. The documentation inconsistencies I’ve uncovered here aren’t random clerical errors—they’re the telltale tracks of a system working as designed, just not as intended by regulators.

Having sat across the table from FBI agents as both a target and later as an advisor, I know firsthand that investigations follow predictable paths. They work backward from the paper trail, identifying every hand that touched a document, following every approval, and documenting every neglected checkpoint.

When investigations reach critical mass, the race to cooperate begins. I’ve seen it time and again: those who come forward early fare better than those who wait for a knock on the door.

The Pattern Is Too Strategic to Be Accidental

Letitia James repeatedly classified her Brooklyn brownstone as having fewer than five units in mortgage documents—sometimes as low as a single-family home. Yet official city records, dating back to 2001, have always identified it as a five-family dwelling.

This wasn’t a clerical error. It happened again and again—across multiple banks, loan programs, and decades. That pattern raises the central question this investigation now explores: Did she act alone? Was she helped? Or did her political influence shield her from scrutiny?

In the mortgage world, unit count determines everything: whether a property qualifies for a residential loan, the size of the down payment, the interest rate, and underwriting rules. Properties with five or more units are treated as commercial and don’t qualify for the favorable terms James repeatedly received.

Multiple Mortgage Professionals Say This Couldn’t Happen Without Help

Veteran mortgage professionals have come forward to say what insiders already suspect: This kind of misclassification doesn’t slip through the cracks—it passes through them with a wink.

Every mortgage involves an appraiser who confirms the structure. Every loan file includes a title company’s review of the Certificate of Occupancy. Underwriters review the whole package. For over 20 years, that process failed repeatedly for one politically powerful borrower.

Either multiple professionals signed off blindly—or someone made sure they didn’t ask too many questions.

Appraiser, Underwriter, Loan Officer, or Title—Who Looked the Other Way?

There are multiple checkpoints where this fraud should have been caught:

• The appraiser who must inspect the property and record its physical characteristics, including unit count. When the Certificate of Occupancy was issued in 2001 listing five units, any competent appraiser visiting the property should have counted the actual units and noted discrepancies with loan application claims of only four units.
• The loan officer who originates the mortgage and prepares the application, with clear legal obligations to verify property details and ensure accuracy. Loan officers have direct access to county property records and are legally required to reconcile discrepancies.
• The title company that must verify legal records—including the Certificate of Occupancy, which clearly states “Five (5) Family Dwelling.” Title searches explicitly include C/O verification as a standard element of due diligence.
• The underwriter who must reconcile those facts with the mortgage program’s eligibility rules. Underwriters are specifically trained to identify inconsistencies between application claims and supporting documentation.
• The lender’s attorney who is present at closing and reviews all final documentation, including the Certificate of Occupancy and property classification. This attorney has a professional and ethical obligation to ensure all documents reflect legal reality and to flag discrepancies that could constitute misrepresentation.

At any one of these stages, the truth could have surfaced. That it didn’t—repeatedly—suggests more than oversight. It suggests complicity, indifference, or political deference.

The Securitization Problem: How Far Did This Reach?

Here’s where the scope potentially expands beyond a single borrower: most residential mortgages are eventually securitized—bundled with other loans and sold to investors who believe they’ve purchased a properly underwritten, legally compliant asset.

Securitization involves rigorous due diligence requirements and representations about the underlying loans. If a five-unit commercial property was improperly classified as a four-unit residential one, it would contaminate the entire mortgage-backed security with misrepresented assets.

This raises disturbing questions about the chain of responsibility: Did secondary market participants know? Were disclosure requirements violated? Did investors unknowingly purchase mortgage securities containing ineligible loans that bypassed standard underwriting criteria?

The Virginia Connection: A Tale of Two Properties

James’ pattern of questionable real estate transactions isn’t limited to Brooklyn. The August 2023 purchase of a property at 604 Sterling Street in Norfolk, Virginia raises equally troubling questions about coordination among professionals.

In this case, James signed a power of attorney declaring: “I HEREBY DECLARE that I intend to occupy this property as my principal residence.” This legally binding statement came just weeks before she launched the high-profile Trump civil fraud trial in Manhattan—where she was physically present nearly every day.

The lender’s attorney who prepared and reviewed the closing documents would have been responsible for ensuring the Power of Attorney was properly executed and consistent with the mortgage application. This attorney would have had a professional duty to question any discrepancy between James’ verbal claims to the mortgage broker and her sworn written declaration of intent to occupy the property as her principal residence.

Notably, when this issue surfaced, Abbe Lowell claimed in his letter to Attorney General Bondi that James had clearly indicated to the mortgage broker that “this property WILL NOT be my primary residence.” But this explanation creates more questions than answers:

If James told the mortgage broker one thing and signed a legal document stating the opposite, which professional helped reconcile these contradictory statements? Who prepared the power of attorney document that contained the principal residence declaration? Did anyone flag this glaring inconsistency?

Most importantly, why did title attorneys, mortgage brokers, and underwriters process a loan application with such a fundamental contradiction at its core? Either James made contradictory statements to different parties, or mortgage professionals deliberately overlooked a significant red flag.

This isn’t just about paperwork errors. It’s about a system of oversight that somehow fails to function when politically connected borrowers are involved.

The Insurance Angle: Another Connection Point

While the insurance implications of misrepresenting unit count have been documented by myself and others like Joel Gilbert, what hasn’t been fully explored is how this creates yet another network of professionals who had to participate in—or at least accommodate—this classification discrepancy.

Insurance underwriters use property records and certificates of occupancy in their risk assessments. Title insurance specifically protects against undisclosed issues like improper classifications. These professionals don’t operate in isolation—they communicate with lenders, appraisers, and mortgage brokers.

This creates an expanding web of influence: Who coordinated these classifications across multiple professional domains? Who ensured consistency in the misrepresentation? And more importantly—who had both the authority and the motivation to ensure these discrepancies persisted unchallenged for decades?

What’s particularly telling is that when Abbe Lowell—James’s high-profile defense attorney—responded to the federal criminal referral letter, he completely sidestepped the insurance implications, the word insurance does not appear in his response. His letter to Attorney General Bondi addressed other allegations but notably omitted any substantive response to the significant insurance discrepancies. This selective defense suggests a vulnerability they preferred not to confront.

We need to look beyond the borrower to the system that supported them—a system where certain influential figures apparently received special treatment that would be denied to ordinary New Yorkers.

One Final Trap: If She Bought the Right Insurance, She Lied Elsewhere

There’s only one way James could have had valid insurance coverage on a five-unit property: by purchasing a commercial policy.

But here’s the problem. If she did that, it proves she knew the true unit count—and lied to her lenders instead.

This creates a legal Catch-22. Either she committed insurance fraud by misrepresenting the unit count on her policy. Or she committed mortgage fraud by admitting the truth to her insurer while hiding it from her bank.

Either way, someone was misled. And someone else stood to gain.

Who Benefits, Who Enables?

Every mortgage transaction creates a trail of signatures, approvals, and waivers. And in this case, that paper trail deserves close examination.

While we don’t have evidence that the same specific lenders were repeatedly involved across all James’ transactions, the pattern of misrepresentations persisted across multiple loans over decades—suggesting either remarkable coincidences or systematic enabling. The identities of these involved parties raises important questions about potential conflicts of interest.

Consider the connections: Which financial institutions processed these loans despite the unit count discrepancy? Whose signatures appear on the appraisals? Which loan officers received commissions? Which title attorneys prepared the closing documents?

Certain patterns emerge when you follow the documentation through the years. The question isn’t just about who missed the discrepancy—it’s about who had reason to overlook it.

A prosecutor might ask: Did anyone involved have ties to political campaigns? Were donations made? Were favors exchanged? Was anyone in a position to benefit from maintaining access to a rising political star?

These aren’t accusations. They’re the natural questions that would arise in any thorough investigation.

This Investigation Now Has a Broader Purpose

The public focus has been on Letitia James. But it’s time to widen the lens. Who else helped this happen? Which underwriters waived red flags? Which title officers failed to verify? Which appraisers submitted boilerplate?

This post is for the ones who know. Whistleblowers. Compliance officers. Front-line professionals who didn’t sign off but suspect who did.

The statute of limitations might protect some. But silence won’t protect all.

During a federal investigation, standard FBI practice includes interviewing every party involved in these transactions, serving subpoenas for all records, and tracing the full chain of approvals. Everyone who touched these files—from loan officers to underwriters to securitization specialists—could be called to testify under oath about what they knew and when they knew it.

These aren’t casual conversations. FBI interviews are conducted under Title 18, United States Code, Section 1001, which makes it a federal crime to lie to federal investigators—even without being under oath. Those who misrepresent facts or conceal information face up to five years in federal prison. Many who thought they were merely peripheral to an investigation have ended up facing charges not for the original crime, but for their attempts to hide their involvement.

I can tell you from personal experience—having been on the wrong side of the law before becoming a cooperating witness—that being interviewed by the FBI is an intense, uncomfortable experience designed to extract the truth. Agents are trained to detect deception and use sophisticated interrogation techniques to break down inconsistent statements. The pressure of sitting across from seasoned investigators who have already reviewed mountains of documentary evidence and spoken with other witnesses creates a psychological environment where maintaining false narratives becomes nearly impossible.

History has shown time and again that the coverup often exposes the crime. What begins as a limited investigation into specific transactions frequently expands when witnesses attempt to conceal information or provide contradictory statements. In case after case, from Watergate to Enron to Madoff, it wasn’t just the original violations that brought down powerful figures—it was the subsequent efforts to hide, minimize, or obscure those violations that ultimately created the most legal exposure.

You know how this works. And you know this one doesn’t pass the smell test.

Now’s your chance to say something—before subpoenas do it for you.

This investigation continues our ongoing series examining New York Attorney General Letitia James’ financial disclosures and property transactions.

© 2025 Sam Antar. All rights reserved.