New York Attorney General Letitia James is facing fresh controversy amid claims that she allowed a fugitive relative to live rent-free in one of her Virginia homes — a revelation that could complicate her ongoing legal troubles and intensify public scrutiny.

Court documents and testimony obtained by federal investigators suggest that Nakia Thompson, James’s grandniece, resided in a Norfolk, Virginia property owned by James despite being wanted in North Carolina for assaulting a police officer and violating parole. Investigators allege that James misrepresented the property’s purpose in mortgage filings, designating it as a “secondary residence” while it was being used by relatives — a classification that allowed her to secure a lower interest rate.

The revelation comes as James already faces federal mortgage fraud charges, accusing her of falsifying financial statements and using the Virginia homes to obtain more favorable loan terms. Prosecutors say that she claimed the property was a personal residence while renting it out to family members, a violation of her mortgage contract.

A source familiar with the investigation said, “The fact that a wanted individual was living in the property adds a new layer of seriousness. It raises questions not just about financial fraud but about potential misuse of property and judgment by a sitting attorney general.”

According to local court records, Thompson was arrested twice in recent years — once for assaulting an officer and again for resisting arrest — but later failed to appear in court. The discovery that she was reportedly living in one of James’s properties surfaced when investigators cross-referenced utility records and state housing filings.

In a statement released through her spokesperson, James denied any wrongdoing, calling the allegations “politically motivated attacks by extremists desperate to discredit me.” She insisted that her property filings were accurate and that she had “no involvement in any relative’s legal matters.”

However, the optics have caused growing concern — even among some of her allies. One Democratic strategist described the situation as “a serious credibility issue,” noting that “when you build your career on accountability and ethics, personal scandals like this can undo years of work.”

Republican lawmakers have been far more direct. Representative Elise Stefanik called for James’s resignation, accusing her of hypocrisy. “Letitia James has spent years targeting her political opponents while violating the very laws she’s sworn to uphold,” Stefanik said. “Housing a fugitive in her home is beyond irresponsible — it’s disgraceful.”

Legal experts say the allegations, if proven, could bolster the federal case against her. “Mortgage fraud cases are typically financial in nature,” said Georgetown law professor Dr. Elaine Carter, “but the presence of a fugitive relative living in a misrepresented property adds an element of willful misconduct that prosecutors love to highlight.”

James’s legal team, however, maintains that the situation has been distorted. They argue that Thompson’s residency was temporary and that James was unaware of her fugitive status at the time. “This is being twisted into something it’s not,” one of her attorneys said. “There’s no evidence the attorney general knowingly harbored anyone wanted by law enforcement.”

The scandal has also drawn national media attention, not only for its potential legal implications but for what it could mean politically. James has long been seen as a rising figure in the Democratic Party, known for her high-profile lawsuits against the Trump Organization and her tough stance on corporate misconduct.

Yet, the combination of mortgage fraud charges and now the allegation of harboring a fugitive threatens to overshadow her legacy. A former state ethics investigator told reporters, “Even if she beats the charges, the damage to her reputation may already be irreversible.”

James is scheduled to appear in federal court later this month for a preliminary hearing related to her mortgage case. Prosecutors are expected to amend their filing to include the latest allegations involving Thompson.

As the story continues to unfold, one thing is clear — what began as a technical legal battle over mortgage documents has transformed into a broader test of integrity for one of the nation’s most visible law enforcement officials. Whether Letitia James can survive it politically or legally remains an open question.