Bam!
Best mugshot ever
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.
Paxton is named in the SEC’s complaint along with William Mapp, the founder and former CEO of Servergy Inc. Paxton is accused of raising hundreds of thousands of dollars for Servergy without disclosing he was making a commission. The case stems from when Paxton was a member of the Texas House — before he was elected attorney general in 2014.
“People recruiting investors have a legal obligation to disclose any compensation they are receiving to promote a stock, and we allege that Paxton and White concealed the compensation they were receiving for touting Servergy’s product,” Shamoil T. Shipchandler, director of the SEC’s Fort Worth regional office, said in a news release on the complaint.
See here for more on the Paxton/Mapp/Servergy relationship, and see here for a copy of the complaint, which as the Chron notes is a civil lawsuit, which may result in a fine for Paxton if he loses. The bit from the complaint that directly relates to Paxton begins on page 17. Here’s a key quote from that section, which is paragraph 78:
Among the people Paxton recruited were his friends, business associates, law firm clients, and members of an investment group to which he belonged. Despite a duty to do so, Paxton knowingly or recklessly failed to inform the individuals he recruited that he was being compensated to promote Servergy to investors.
Basically, this is saying that Paxton lied to his friends, colleagues (including Rep. Byron Cook), clients, and coworkers by exhorting them to invest in Servergy without telling them that he would get a kickback if they did. What a guy, right? We are very early in this story and there is sure to be much more to come, so stay tuned. One thing we can say, though, is that Paxton’s fellow Republicans really don’t want to talk about him.
Top leaders including Gov. Greg Abbott and Lt. Gov. Dan Patrick have been mostly silent on the issue, giving Paxton the benefit of the doubt and allowing the legal battle to play out with the AG still in power.
What’s more, the people who were instrumental in his election don’t care about the charges against him. They support him because his conservative credentials are in line with the grassroots activists that now dominate the GOP.
In the past, donors like Bob Perry, Fred Meyer and Louis Beecherl had tremendous influence because their money could make or break candidates for public office.
Today, grassroots candidates who aim to shake up the establishment don’t need money from old-line political donors. They are boosted by folks like Midland oilman Tim Dunn and the billionaire Wilks brothers out of Cisco.
So candidates like Paxton have not only support at the ballot box from activists, but also a fundraising base to hold potential opponents at bay.
Fine by me. I’ll say again, I hope he’s on the ballot in 2018 as a convict. It would sum up the state of the state’s Republican party perfectly. Trail Blazers, TPM, the Lone Star Project, the Current, Newsdesk, PDiddie, and the Press have more.
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