Guest post by Joel Gilbert
In a development that has stunned New York’s financial and political establishment, Fannie Mae and Freddie Mac have announced the closure of their offices in the state.
According to a report published by Fox News, the decision comes as the mortgage giants seek to distance themselves from what they describe as Attorney General Letitia James’s “corrupt and dangerous business practices” in the state.
At the center of this storm is New York Attorney General Letitia James herself, who faces legal scrutiny following allegations of engaging in years of mortgage fraud, as I have detailed in The Gateway Pundit since March 2025.
While James has built her political career around aggressive prosecutions of real estate fraud, the federal government apparently won’t stand for James’s hypocrisy, as New York state’s top legal officer is alleged to have engaged in the very practices she has vowed to stamp out.
Fannie Mae and Freddie Mac are government-sponsored enterprises that play a pivotal role in the U.S. housing market.
They purchase and secure mortgages to provide liquidity and stability.
Their departure from New York is not just a symbolic rebuke, it threatens to create real disruptions in lending, refinancing, and investment within the state.
Industry analysts warn that the closures could harm New York residents.
First, it could reduce mortgage availability in New York, as lenders face new uncertainty about secondary market support.
Second, it could drive up interest rates for New Yorkers compared to other states. Finally, it could weaken investor confidence in the state’s financial climate, particularly in real estate.
For a state that already struggles with high housing costs and a dwindling base of middle-class homeowners, the exit of these institutions’ offices due to Letitia James’s alleged corruption could have far-reaching consequences.
The backdrop to this decision lies in my investigations that detail Letitia James pattern of engaging in fraudulent mortgage dealings for 43 years.
I have reported that James benefited financially from a pattern of mortgage fraud whereby she took out loans, refinanced, and got credit lines on her 5-unit apartment building in Brooklyn by falsely claiming her building had between 1 and 4 units.
James did this in order to qualify for lower residential mortgage rates she was not entitled to, as well as much lower closing costs.
These behaviors by Letitia James represent a glaring conflict of interest for the state of New York.
James built her reputation on pursuing financial misconduct, from Wall Street cases to her high-profile civil fraud lawsuit against former President Donald Trump.
Any perception that she herself manipulated mortgage systems undercuts both her credibility and her office’s integrity. Fannie Mae and Freddie Mac have apparently seen enough.
For ordinary New Yorkers, the implications of Fannie Mae and Freddie Mac stepping back from the state may have even worse consequences.
Mortgage access may tighten, especially for first-time buyers and working-class families. Refinancing options may shrink, leaving borrowers trapped in higher-interest loans. Finally, affordable housing projects could stall, as developers lose reliable financing channels.
These outcomes would strike hardest in urban centers like New York City, where affordability is already stretched to the breaking point.
It’s clear that Letitia James’s alleged misconduct has the potential to create instability in the very housing market she is supposed to protect as Attorney General.
The closure of Fannie Mae and Freddie Mac’s New York offices is not just a state-level story, it reverberates nationally.
Government sponsored enterprises like Fannie Mae and Freddie Mac are critical to the overall U.S. housing market, and their withdrawal from the country’s largest metropolitan hub sends a chilling signal.
The shuttering of Fannie Mae and Freddie Mac offices in New York and the allegations of mortgage fraud against Letitia James converge on a common theme: trust.
Trust in institutions, trust in leadership to enforce the law without conflict of interest, and trust in the housing market itself.
For New Yorkers, the closures are more than headlines; they represent potential barriers to homeownership and stability.
For the nation, they serve as a stark reminder that the integrity of public officials is not an abstract issue, it can shape markets, livelihoods, and the very foundations of economic security. Until Letitia James resigns, New York’s financial ecosystem faces an uncertain future.
Joel Gilbert is a Los Angeles-based film producer and president of Highway 61 Entertainment. He is the producer of the new film Roseanne Barr Is America. He is also the producer of: Dreams from My Real Father, The Trayvon Hoax, Trump: The Art of the Insult, and many other films on American politics and music icons. Gilbert is on Twitter: @JoelSGilbert.
The post The Letitia James Effect: Fannie Mae and Freddie Mac Shutter New York Offices Amid Mortgage Fraud Allegations appeared first on The Gateway Pundit.