Mar 27, 2024 - News

Ken Paxton reaches deal in fraud case

Photo Illustration of Attorney General Ken Paxton with lines radiating from him.

Photo illustration: Axios Visuals. Photo: Stefani Reynolds/Getty Images

Texas Attorney General Ken Paxton has dodged criminal prosecution in a long-running felony securities fraud case, agreeing to community service to avoid a trial and conviction.

Why it matters: The agreement with prosecutors appears to be an anticlimactic end to the 9-year-old case — and allows Paxton to maintain an unblemished record, even as he has faced myriad accusations of corruption.

Catch up quick: Paxton was indicted on securities fraud charges shortly after he took office as attorney general in 2015.

  • Paxton faced allegations that he persuaded investors, including then-Republican state lawmaker Byron Cook, to purchase at least $100,000 worth of stock in a tech startup, Servergy, without disclosing that he would be paid for it.

Driving the news: Yesterday, prosecutors agreed to drop the charges if Paxton performs 100 hours of community service.

  • The agreement also requires him to take legal education courses and pay restitution to those he is accused of defrauding.
  • The total amount of restitution will be "somewhere a little bit south of $300,000," prosecutor Brian Wice said, per the Texas Tribune.
  • Paxton will not have to enter a plea under the terms of the agreement.

Speaking to reporters in Houston yesterday, Paxton attorney Dan Cogdell said Paxton was "more than happy to comply" with the terms of the dismissal.

  • "But let me be clear, at no time was he going to enter any plea bargain agreement or admit to conduct that simply did not occur," Cogdell said in a statement.

The other side: "​​Something is wrong when the state's top lawyer is forced to take a class on how to be a good lawyer," John Bucy III, a Democratic state lawmaker, wrote on X.

Between the lines: Paxton is still facing a whistleblower lawsuit from former aides who claim they were improperly fired for reporting him to the FBI on corruption allegations.

  • Paxton has denied any wrongdoing.

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