Texas attorney general Ken Paxton departing after testifying at a Texas Texas Senate Health and Human Services Committee hearing on Planned Parenthood videos covertly recorded that target the abortion provider, July 29, 2015. 
Photo by Eric Gay/AP

Texas Attorney General faces new fraud allegations

Last summer, Texas Attorney General Ken Paxton (R) suffered the indignity of having to turn himself in to police. The Lone Star State’s highest ranking law-enforcement official was indicted by a grand jury on three felony counts related to alleged securities fraud.
As a rule, as we discussed at the time, when a state A.G. finds himself facing criminal charges, it’s a bit of a problem. Paxton and his defense attorney, however, insisted that the far-right Republican did nothing wrong and would remain in office.
Yesterday, as the Texas Tribune reported, things got just a little worse for Paxton.
Texas Attorney General Ken Paxton has been charged in federal court with allegedly misleading investors in a technology company.
The U.S. Securities and Exchange Commission filed the charges Monday in a Sherman-based court. They are similar to the allegations Paxton faces in a pending indictment handed up by a Collin County grand jury last year.
Following up on our previous coverage, at issue is a Texas computer company called Servergy, which is facing an investigation into whether or not it defrauded investors, but which also paid Paxton a commission when he found new Servergy investors. According to the indictment, Paxton successfully encouraged people to invest more than $600,000 in the company, without disclosing his personal financial interests, and despite the fact that he wasn’t licensed as an investment adviser.
As Slate added, the timing of these developments doesn’t do Paxton any favors:
The new federal charges arrive just a week before the most important day of Paxton’s career: Next Monday, the Supreme Court will hear a challenge to the legality of President Barack Obama’s deferred deportation executive actions – litigation led by Paxton in his capacity as Texas attorney general. Paxton, a Republican, is also the lead author of a crucial brief filed to the Supreme Court explaining why the justices should side against Obama’s executive actions. (Incidentally, some legal scholars have argued that Paxton’s brief is filled with intentional obfuscation that violates rules of professional conduct.)
As for the fraud allegations, the Texas Tribune’s report also noted that Texas’ securities board fined Paxton in 2014: “At that time, Paxton, who was then running for attorney general, admitted he solicited clients for an investment firm without disclosing that he would be paid a percentage of the fees the firm collected from their business.”