When federal prosecutors referred Letitia James for criminal investigation on April 14, 2025, they may have missed their most powerful weapon. Criminal cases drag. Civil enforcement hits fast—and puts witnesses under oath.
The Strategic Advantage
Criminal prosecution isn’t the only weapon in DOJ’s arsenal. A parallel civil case under FIRREA offers lower burden of proof, powerful discovery tools, and faster resolution—while potentially strengthening the criminal case through depositions and document production that can lock in testimony or corner James into pleading the Fifth.
Parallel Proceedings: A Proven Strategy
This parallel approach isn’t theoretical—it’s exactly how complex financial fraud cases are handled. In the Crazy Eddie case, DOJ pursued criminal charges while the SEC simultaneously brought civil enforcement actions. While DOJ couldn’t share criminal investigation materials with the SEC due to grand jury secrecy rules, the SEC could share its civil discovery and findings with DOJ. The SEC’s broader scope and lower burden of proof proved crucial—ultimately finding multiple Antar family members liable for securities fraud regardless of their criminal case outcomes:
- Eddie Antar (founder): Criminally convicted → Also faced civil penalties
- Mitchell Antar (Eddie’s brother): Criminally convicted → Also faced civil penalties
- Sam M. Antar (Eddie’s father): Never criminally indicted → $57.5 million civil penalty
- Allen Antar (Eddie’s brother): Criminally acquitted → $11.9 million civil penalty
- Benjamin Kuszer (Eddie’s brother-in-law): Never criminally indicted → $3.3 million civil penalty
- Deborah Rosen Antar (Eddie’s former wife): Never criminally indicted → ~$8 million disgorgement
- Three relief defendants: Never criminally indicted → $425,000 each for stock sales
Total civil recoveries exceeded $83 million from defendants who either beat criminal charges or were never criminally charged at all.
As the former CFO of Crazy Eddie who testified for the government in both the criminal and civil cases, I witnessed firsthand how parallel proceedings maximize accountability. This precedent shows FIRREA enforcement could extend not only to James but to anyone who materially participated in or certified false filings—including attorneys, brokers, co-borrowers, or title agents who facilitated, endorsed, or knowingly ignored false occupancy or unit representations on federally backed mortgages—regardless of their criminal culpability.
In Part I, I detailed how Letitia James handed federal prosecutors a perfect criminal case. Now let’s examine why a civil enforcement action may be even more effective—and how it practically writes itself.
This civil case wouldn’t be exploratory—it’s anchored in the April 14 DOJ referral, which cites both Virginia and Brooklyn properties in a documented fraud scheme. The FHFA’s criminal referral letter provides the roadmap—civil enforcement can run parallel.
The FIRREA Framework: Built for Cases Like This
The Financial Institutions Reform, Recovery, and Enforcement Act gives DOJ a powerful civil enforcement tool specifically designed for mortgage fraud cases involving federally backed loans.
Key FIRREA Advantages:
- Lower Burden: Preponderance of evidence vs. beyond reasonable doubt
- High Penalties: Up to $1.1 million per violation
- Broad Scope: Covers false statements on federally backed loans
- No Loss Required: Fraud complete upon making false statement
Under 12 U.S.C. § 1833a, DOJ can pursue civil penalties for violations of 18 U.S.C. § 1014 (false loan statements) and 18 U.S.C. § 1344 (bank fraud) involving federally backed loans—which includes GSE-backed mortgages regardless of whether the originating lender is a bank or non-bank institution.
How FIRREA Calculates Civil Penalties
Under 12 U.S.C. § 1833a(b), penalties are based on the number of violations and the amount of gain or loss. The statute allows up to $1.1M per violation or the amount of pecuniary gain—whichever is greater. With James’s documented $100,000+ benefit per property and decades of false statements, penalties could far exceed the statutory cap.
The Evidence: Two Decades of False Statements
🎯 The Smoking Gun: Sterling Street, Virginia (2023)
James signed a sworn Power of Attorney declaring intent to occupy 604 Sterling Street as her principal residence. The $219,780 mortgage was backed by Fannie Mae.
August 2, 2023 Email
“This property WILL NOT be my primary residence”
August 17, 2023 Declaration
“I intend to occupy this property as my principal residence”
Result: Over $100,000 in benefits through owner-occupied financing
Reality: Never moved in; launched Trump trial in Manhattan 45 days later
📋 The Pattern: Brooklyn Property (2001-2024)
James has repeatedly claimed her 296 Lafayette Avenue building is a four-unit property, despite its Certificate of Occupancy explicitly designating it as a FIVE-FAMILY DWELLING. Con Edison records show six electric meters—five apartments plus common area.
| Official Records | James’s Claims |
|---|---|
| Certificate of Occupancy: 5-Family Dwelling | Mortgage docs: 1-4 units |
| Con Edison: 6 electric meters | HAMP modification: 4 units |
| Physical inspection: 5 doorbells | Building permits: 4 units |
Impact: 20+ years of false statements on federally backed loans and modifications
Some may question the wisdom of prosecuting a sitting Attorney General. But James herself eliminated this concern with her Trump prosecution, declaring that financial misrepresentations merit severe consequences “regardless of wealth, power, or political affiliation.” Her own standard applies.
Discovery: The Civil Case’s Secret Weapon
Unlike criminal cases, civil discovery offers quick access to documents and testimony that can expose the full scope of James’s scheme:
Document Production Goldmine
- Communications: Complete email chains with mortgage brokers, loan officers, attorneys, and lenders
- Financial Records: All loan applications, financial statements, tax returns, and bank records
- Property Documentation: Appraisals, inspections, certificates of occupancy, building permits
- Title Records: Title searches, insurance policies, deed transfers, and closing documents
- Travel & Residency: Flight records, hotel receipts, credit card statements showing location
- Official Calendars: NY AG office schedules proving Manhattan presence during required Virginia occupancy
- Utility Records: Con Edison accounts, water bills, and other services establishing actual occupancy
- Government Filings: Building permits, tax assessments, voter registrations, driver’s licenses
- Internal Communications: NY AG office emails, memos, and documents about personal real estate matters
- Third-Party Records: Underwriting files, compliance reviews, and risk assessments from lenders
Unlike criminal discovery, civil production happens quickly and comprehensively. If James invokes the Fifth in depositions, it strengthens DOJ’s hand in any criminal prosecution. If she doesn’t, her testimony can be used against her later.
Key Depositions Under Oath
| Letitia James | Explain contradictions or plead the Fifth |
| Co-borrowers | Knowledge of property use and occupancy plans |
| Mortgage brokers | Communications about property classifications |
| Loan officers | Application processing and verification procedures |
| Lender representatives | Underwriting decisions and documentation review |
| Title company officers | Property research and disclosure processes |
| Appraisers | Property inspections and unit count determinations |
| Attorneys | Transaction oversight and document preparation |
| Document witnesses | Circumstances of document execution |
Precedent: FIRREA’s Track Record
Federal courts consistently uphold FIRREA penalties for occupancy fraud—often with weaker evidence than James provided:
| Case | Evidence | Penalty |
|---|---|---|
| U.S. v. Boehm | Circumstantial | $850,000 |
| U.S. v. Chen | Never moved in | $1.2M settlement |
| U.S. v. James (potential) | Written confession | Up to $1.1M per violation |
Why James’s Case Is Stronger Than These Precedents
Most occupancy fraud cases rely on circumstantial evidence like utility records or rental agreements. James provided something prosecutors dream of: written proof of fraudulent intent.
Her August 2 email expressly denies intent to reside—just 15 days before swearing the opposite under penalty of perjury. This creates an evidentiary record that few fraud cases can match.
Why DOJ Must Act Now
Time-Sensitive Factors
- 2026 Election: James filed for re-election—voters deserve to know
- Evidence Preservation: Memories fade, documents disappear
- Public Confidence: Equal justice requires prosecuting prosecutors
- Taxpayer Accountability: Campaign donors, scheduling records, and taxpayer expenditures may all become discoverable if James used official resources while managing her mortgage filings or property claims
- Statute of Limitations: FIRREA’s 10-year window is running
Civil discovery can secure critical evidence while criminal prosecutors build their case.
The Bottom Line
Letitia James built her career prosecuting financial fraud. She secured a $355 million judgment against Donald Trump for property misrepresentations. She declared that “no one is above the law.”
Now she faces the same scrutiny—backed by her own written confession of fraudulent intent.
The Case Writes Itself
DOJ has the authority, the evidence, and the precedent. They also have something prosecutors rarely get in mortgage fraud cases:
A written confession, delivered gift-wrapped by the defendant’s own attorney.
James made the rules. Now she should face them—in civil court, if not yet in criminal.
Written by Sam Antar
© 2025 Sam Antar. All rights reserved.