Texas AG Enters Sudden Deal in Securities Fraud Case

Texas Attorney General Ken Paxton agreed to a last-minute deal with prosecutors that allowed the dismissal of almost 9-year-old criminal charges on Tuesday. The 18-month intervention agreement was announced in a pretrial hearing that had been delayed from last week. 

The agreement includes 100 hours of community service and 15 hours of legal education classes that focus on ethics. He will have to pay $270,000 in restitution. 

Paxton’s securities fraud case was one of the longest-running cases in Texas history. He was set to go to court on April 15, almost nine years after he was charged. A Collin County grand jury indicted Paxton on three felony securities fraud charges in July 2015. It was just months after he was sworn in as attorney general. 

This agreement comes less than a year after he survived an impeachment attempt on unrelated corruption claims. The FBI is reportedly still investigating. His tenure in office has been one of serving while under indictment for felony charges. 

The resolution was entered in a seven-minute hearing in a Houston court. It was a sudden conclusion to the long-standing case. Paxton is in his third term as attorney general. Paxton was in court and remained silent except when he confirmed that it was his signature on the agreement. He is not required to admit any wrongdoing. 

“I am grateful to reach this agreement, to get this matter behind me, so I can get back to the work representing the state of Texas,” Paxton said in a statement Tuesday.

This all began when Paxton was indicted in July 2015 for failing to inform friends that he would make a commission on their investment in a North Texas tech company. He also failed to register with the state as an investment adviser. 

Paxton’s trial was repeatedly delayed. Reasons included disputes over prosecutor pay and where he would be tried. Some slowdowns affected all court cases because of Hurricane Harvey and the COVID-19 pandemic. He dodged a bullet. He could have suffered serious penalties if convicted. He could have been sentenced to decades in prison, banned from running for office, and lost his law license. 

Paxton’s defense attorneys said it’s not a plea bargain. Paxton didn’t admit guilt.

“At the end of the day, it’s not a plea bargain,” Dan Cogdell, one of Paxton’s defense attorneys, told reporters after the hearing. “There is no admission of guilt and there will never be an admission of guilt because he is not guilty.”

Cogdell said it was a case “we knew, from day one, they couldn’t prove,” adding that the restitution Paxton will pay is less than he’d pay for his defense team to go to trial.

The special prosecutor admitted justice was delayed for Paxton. He explained why he agreed to the deal so close to the trial date. 

Special prosecutor Brian Wice said he agreed to a deal because it would bring justice to the victims, and his obligation was always to find a fair resolution, not necessarily to convict Paxton.

“While I think the case could be made that justice was certainly delayed,” Wice said, “I think the agreement that we’ve reached today underscores the fact that justice was not denied.”

With all this behind him, Paxton’s political influence may grow. That is, if no new wrongdoing comes forward. Who knows? Maybe he’ll run for the Senate or Governor in the future. 

He’s not quite out of the woods, though.

The allegations of bribery and abuse of office that began his impeachment drama are allegedly being investigated by a federal grand jury in San Antonio. He still has a whistleblower lawsuit against him that was filed by four of his former top aides. They claim he fired them as retaliation for reporting him to the FBI. And there is a case moving through the courts by a committee of the State Bar of Texas. It seeks disciplinary action against Paxton for filing a “dishonest” petition before the Supreme Court to overturn the 2020 presidential election result. 

Paxton has 18 months to pay $270,000 to former Rep. Byron Cook and the estate of Florida businessman Joel Hochberg. Wice said if Paxton repays the money, he would consider cutting short his supervision of Paxton. The agreement requires Paxton to check in with prosecutors every 60 days. The community service agreement requires him to volunteer at a soup kitchen or food pantry in Collin County. 

So, for Ken Paxton, the majority of his legal troubles have ended, as long as he fulfills the agreement. We’ll see if he continues to enjoy political success despite his legal challenges.