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  • 1440 Daily Digest

Paxton Avoids Fraud Trial

Texas Attorney General Ken Paxton (R) reached a deal yesterday with prosecutors to resolve criminal securities fraud charges, ending a years-long saga weeks before his trial was set to begin. Paxton maintains his innocence.

In 2011, Paxton—then a state representative—was accused of recruiting two people to invest in Texas-based computer server company Servergy without disclosing to them his role as a paid adviser. Servergy's CEO was later found guilty of misleading investors, including through claims it had secured Amazon as a client (see story here). Now, Paxton has agreed to pay $271K to the two investors he recruited. The deal also requires Paxton to complete 100 hours of community service and take legal classes. Paxton had faced the possibility of 99 years in prison and loss of his legal license.

These charges are separate from an ongoing FBI investigation into whether Paxton traded political influence for favors with real estate developer Nate Paul. The Texas Senate acquitted Paxton in an impeachment trial over related charges last year.

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