Federal prosecutors have quietly launched a new investigation into New York Attorney General Letitia James, a high-profile Trump antagonist who built her national brand going after conservatives—only to now find herself once again under federal scrutiny.
According to the New York Times and CBS News, investigators are examining $36,000 in campaign payments made by James to her longtime hairdresser, Iyesata Marsh, during James’ successful 2018 reelection bid. The payments ran from May 2018 through February 2019, and the probe is said to be in its early stages.
Marsh, a Brooklyn salon owner and event manager, was indicted last month in Louisiana on federal charges of bank fraud and aggravated identity theft—a development that appears to have reopened federal interest in her past financial dealings, including her relationship with James’ campaign.
Sources familiar with the investigation told the Times that prosecutors want to question Marsh about financial transactions involving James and her campaign.
A past Wall Street Journal report revealed that roughly $22,000 of the campaign money paid to Marsh was for the use of her salon studio as a campaign office during the final four months of James’ run.
Marsh, who lives in Queens, allegedly used the identity and personal information of an unidentified Ohio woman, along with her nephew, to secure a $48,000 loan to purchase a Land Rover from a Florida dealership, according to federal court filings. The loan was processed through Louisiana, giving federal prosecutors there jurisdiction over the case.
There is no indication that James is directly tied to Marsh’s alleged criminal activity.
Still, the optics are hard to ignore for an attorney general who has made a career out of accusing others—particularly President Donald Trump—of financial misconduct.
James and Trump have been bitter political rivals since Trump’s first term, with James repeatedly campaigning on promises to “get” Trump and later bringing civil cases against him that thrilled the left and outraged conservatives.
The latest probe comes after a series of failed attempts by the Department of Justice to indict James on separate mortgage fraud allegations. Prosecutors last year secured an indictment in Virginia accusing James of bank fraud and making false statements related to a Norfolk home she purchased in 2020, but that case was later dismissed by a federal judge.
A grand jury subsequently declined to indict James twice more, dealing a major setback to federal prosecutors.
James and her legal team have framed all federal scrutiny as political retaliation by Trump—a claim they reiterated again this week.
Her attorney, Abbe Lowell, blasted the new probe and accused the administration of abusing its power.
“Clearly frustrated by the string of failures in carrying out President Trump’s political vendetta against Attorney General James.”
Lowell went further, accusing federal authorities of intimidation tactics:
“His obedient Justice Department appears to be using its vast resources to try to shake down people based on their association with Ms. James.”
And he insisted the effort would collapse like the others:
“Like their earlier attempts, this attack on Ms. James is doomed to fail. The desperation of those working for Trump is palpable and makes indelible the stain already put on this Justice Department.”
A legal representative for Marsh declined to comment, and attempts to reach her directly were unsuccessful.
Marsh operates Studio Phenomenon-Luxury Salon in Prospect Heights and was publicly celebrated in 2022 at a “Power Women of the Bronx” event, where James both spoke and received honors, according to the Bronx Times.
After her arrest in early December, federal prosecutors sought to have Marsh detained pending trial, but a judge instead approved $50,000 bail, which she posted.
