A federal grand jury in Norfolk, Virginia, has declined to indict New York Attorney General Letitia James after the Department of Justice (DOJ) refiled mortgage fraud charges against her. This decision follows a judge's earlier dismissal of bank fraud charges against both James and former FBI Director James Comey, which was attributed to the improper appointment of Lindsey Halligan as the top federal prosecutor in the Eastern District of Virginia. The judge allowed the government the opportunity to re-file charges.

The indictment rejection is notable, as it is uncommon for grand juries to decline to bring charges; in the 2016 fiscal year, only six out of over 150,000 investigations resulted in such a decision, according to Justice Department statistics. James faced allegations of misrepresenting a property in Norfolk, Virginia, to secure a more favorable mortgage interest rate, while asserting that the charges are politically motivated, particularly given her previous civil lawsuit against former President Donald Trump regarding alleged misrepresentation of his real estate assets.

In 2023, a judge ruled that Trump and his company had violated fraud laws, imposing significant financial penalties, though some non-financial penalties against the Trump Organization remain in effect. James's legal team has argued for the dismissal of her charges, citing vindictive prosecution and misconduct by government officials, including references to Trump's public calls for investigations into her actions.

The charges against Comey and James were pursued following a tumultuous period in the U.S. Attorney's Office for the Eastern District of Virginia, marked by the resignation of Halligan's predecessor amid concerns over his reluctance to charge James. Halligan, a former White House staffer and personal attorney to Trump, was appointed as interim U.S. attorney shortly thereafter. Both Comey and James have contested the legality of Halligan's appointment and sought to have their charges dismissed. The judge dismissed their indictments without prejudice, allowing for the possibility of re-indictment.

The broader context includes ongoing discussions about the influence of campaign financing in district attorney races, particularly the financial contributions from billionaire George Soros, who has significantly impacted criminal justice reform through his funding of progressive district attorneys. Reports indicate that by 2023, these prosecutors governed over 20% of the U.S. population and half of the residents in major cities. Critics argue that the policies associated with Soros-backed prosecutors have led to increased crime rates in several cities, raising questions about the balance between reform and public safety.

As communities continue to grapple with the implications of these policies, there has been a noticeable shift in public sentiment, with some Soros-linked district attorneys facing recall efforts or being replaced by more traditional candidates since 2022. This trend raises concerns about the long-term viability of the progressive criminal justice reform movement and its impact on community safety.