The 26-year-old has had three previous spells at Victoria Park and last left the club last summer to join League Two side Barrow despite Pools offering him a new deal.
But following Hartlepool’s Football League return, James has typically been linked with a move back to the club where he made 192 appearances, scoring 31 goals between 2010 and 2020.
Hartlepool manager Dave Challinor confirmed the rumours did have an element of truth to them although little progress has been made as of yet.
“It’s something there was sniffs of a few weeks back but nothing has materialised on that front so far,” he told The Mail.
“I don’t envisage that changing before the weekend but we’ll see how things go.”
James enjoyed a solid run of form during the early stages of Challinor’s tenure at Pools before his season was ended early due to a serious groin injury.
"Luke is somebody who knows the club and we understood why he moved on last year because he went to a Football League club,” Challinor continued.
"We liked him and would have liked to have kept him because before he got injured, he was one I felt, the criticism with Luke was always around goalscoring and we saw different things on the training pitch and started to see different things in games when he was playing as a central striker that probably wasn’t as evident when he was out wide.
"He was probably doing too much work off the ball chasing other players, a bit like Oatesy [Rhys Oates] when he was first here and we all saw how that turned out.
"We won’t rule it out and never say never but at the moment it’s not something that is around the corner for us.”
Pools are still hoping to confirm a signing or two before their season opener against Crawley Town at Victoria Park on Saturday (3pm kick-off).
Challinor has stated a goalkeeper and another striker are among his top priorities at the moment with several additions expected before the transfer deadline on August 31.