The district attorney in Collin County declined to take the case, citing a conflict of interest because he and Paxton have a longstanding business relationship, and handed it off to a pair of Houston defense attorneys, Brian Wice and Kent Schaffer, who were appointed to prosecute the case.
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The Texas Democratic Party rallied outside the Collin County Courthouse shortly after Paxton turned himself in, calling on the attorney general to resign.
A Collin County grand jury heard evidence that Paxton had been given 100,000 shares of Servergy stock.
“Two of the charges – first-degree felony securities fraud – carry the possibility of hefty jail sentences”, reports member station KUT in Austin.
The third indictment alleges that about one year later, Paxton “knowingly and intentionally [rendered] services as an investment advisor representative to James and Freddie Henry” while Paxton was not registered with the Securities Commissioner of Texas. Neither of the top Republican lawmakers expressed support of their fellow Texas official.
He pointed out that the indictment against Paxton was handled by a grand jury in Collin County north of Dallas, which is among the most conservative counties in Texas.
Two of them are first-degree felonies accusing the 52-year-old Republican of engaging in fraud by facilitating the sale of more than $100,000 in stock in a tech startup based in his hometown of McKinney.
Still, Paxton friend and state Rep. Matt Krause pointed to the recent dismissal of one of Perry’s two charges as a sign that indictments should not always be accepted at face value.
Paxton’s name also appears in a federal court document as a major investor in a Dallas-area firm in a U.S. Securities and Exchange Commission investigation. The filing accused the company of lying to investors about having pre-orders from companies, including Amazon.
Paxton’s appearance was a low-key affair compared with the arraignment of then-Governor Rick Perry of Texas on abuse of power charges previous year.
Rice University Public Policy Professor Mark Jones says numerous calls for Paxton’s resignation have to do with maintaining the reputation of the Attorney General’s office. In his statement to the clerks, Paxton acknowledged that such refusals could result in lawsuits or fines, but he also wrote that “numerous lawyers stand ready to assist clerks defending their religious beliefs, in many cases on a pro-bono basis, and I will do everything I can from this office to be a public voice for those standing in defense of their rights”. If convicted, however, Paxton could lose his law license and have to step down from his position as attorney general, the article notes.
Ken Paxton may have less success in saying his charges are political, politics watchers said. The storm has been kicked up by Associate Press news item, which stated that Paxton is a shareholder of Servergy Inc. and is encouraging investment of funds from large corporate investors.
“There’s a reason why Texans have warily observed this news”. He paid a $1,000 positive and chalked it up as an administrative oversight.
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“Some of the outrageous events surrounding this sloppy process certainly do not typify the level of quality that Texans expect from our judicial system”, said Aaron Whitehead, spokesman for the Republican Party of Texas.
