A legal defense fund tapped by Attorney General Letitia James is redirecting some donations after experts said the arrangement is an ethical quagmire.
The Democratic Attorneys General Association last year launched a legal defense fund, which has paid nearly $720,000 to lawyers defending James against federal mortgage fraud charges. But the group recently redirected $5,200 from two donors after Gothamist published details about their giving being motivated by a desire to help James.
The state’s Commission on Ethics and Lobbying in Government, or COELIG, cleared James to accept the aid in December because it believed donors to the defense fund would remain anonymous. That wasn’t quite the case.
The Democratic group’s donors are publicly disclosed in tax filings, which the commission didn’t initially realize. It corrected its written opinion but said the error didn’t change its approval.
Outside experts said it remains problematic.
“It is troubling because it does provide a means for third parties to channel funds to the attorney general,” said Columbia Law School professor Richard Briffault, a former chair of the New York City Conflict of Interest Board.
James said the mortgage fraud charges were motivated by President Donald Trump’s desire for revenge against her for a fraud judgment she won against him and his business, and Democrats leaped to her defense. A federal judge in Virginia later dismissed the indictment.
The Democratic Attorneys General Association, which supports Democratic attorneys general and candidates across the country, established the defense fund two weeks before James was indicted in October. The group’s president, Sean Rankin, said the association expected the attacks on James and potentially other attorneys general to escalate.
The fund has raised more than $1 million, a spokesperson for the group said. Donors to the fund aren’t separately disclosed, but the organization's filings — posted publicly by the Internal Revenue Service — show a flurry of contributions from New Yorkers in the days after James was indicted.
Gothamist reported in May that those donors included lobbyists, major labor unions, developer Jeff Gural and state Sen. John Liu. Both Liu and Gural, who co-owns the Flatiron Building, told Gothamist that they were supporting James.
Democratic Attorneys General Association spokesperson Emily Trifone said Liu and Gural’s donations — totaling $5,200 — were redirected in June to support the group’s general operations after Gothamist reported that their donations were aimed at James’ defense. James’s spokesperson directed questions to the group.
COELIG, the state ethics commission, last month amended its advisory opinion about the legal defense fund and its opacity. It still found the fund to be within bounds of its standards.
“We don't believe that this changes the original analysis in any way,” Michael Sande, COELIG’s director of ethics, said at a board meeting. “In the end, there's no way for the attorney general to learn who has contributed money to the defense fund with the intention of benefiting her directly.”
Briffault disagreed. He said he believed that James would act ethically regarding her legal defense, but worried about the precedent and procedure that the ethics panel established.
“Somebody doesn't have to earmark their contribution to DAGA for the AG,” he said. “They can just give it with winks and nods and know where it's going. So, it just seems a little naive, to be honest.”
All the donors identified by Gothamist are potentially interested parties who could have matters pending before James’s office, according to George Weissman, a former state ethics commissioner. They include Valerie Berlin, a cofounder of the lobbying and public relations firm BerlinRosen; lobbyist Emily Giske; a political action committee associated with SEIU 1199, a union representing healthcare workers; and Local 1180 of the Communication Workers of America.
“This is like walking in quicksand,” Weissman said. “The number of carveouts here for the attorney general to be able to take this money exceed anything rational — at least in my mind.”
James’s spokesperson Alexis Richards said the attorney general hasn’t recused herself from any cases related to her legal defense.
Transparency advocates have said there should be strict standards on legal defense funds to avoid possible conflicts. Rachael Fauss of the government watchdog Reinvent Albany said New York state should pass a law dealing with the issue.
“We should have a more strict system set up, like we have in New York City, where people who have business dealings with government are completely ineligible to give the contributions,” she said.
State lawmakers in 2025 passed a $10 million appropriation to cover legal fees for state employees stemming from “what could reasonably be construed to constitute discriminatory or retaliatory treatment by the United States government.”
Republicans at the time attacked the new fund as a bailout for James, who they’ve said unfairly investigated Trump’s real estate practices. James won a 2023 fraud judgment against the Republican president that cast doubt on Trump’s claims to be a brilliant businessman.
James opted against using the special appropriation because she didn’t think taxpayers should have to foot the bill for a criminal case that didn’t directly involve her official actions.
Weissman, who was appointed by Republicans, said James should have tapped the state funding. He said her prosecution by a U.S. attorney in Virginia was “highly questionable.”
State taxpayers are covering legal defense costs related to two subpoenas sent to the Office of Attorney General by a federal prosecutor based in Albany. The subpoenas sought records of James’s probe into Trump as well as her case against the National Rifle Association.
A federal judge quashed the subpoenas. The state has so far paid $1.4 million to an outside law firm to handle the case.
