Paxton’s legal team was quick to pounce on the revision, however, with attorney Joe Kendall releasing a statement saying “This confirms that there have been troubling issues with the Grand Jury process from the beginning. They had months to investigate and then rushed to indict.
Special prosecutors in Collin County, Texas re-issued felony securities fraud charges on Tuesday against the state’s Attorney General Ken Paxton. Paxton had originally been arrested and indicted on July 28th, turning himself in at the county’s jail. Among other charges, the McKinney Republican is accused of selling stock to another Texas politician and a Florida businessman for a profit without being registered by the Texas State Board of Securities. If convicted on all counts, Paxton could face up to 99 years in prison. The indictment is the first for a sitting Attorney General in the state in over 30 years. The actual charges themselves have remained the same for both indictments. The investments in question revolve around the data storage company Servergy, in which Paxton held thousands of shares of stock while serving as a member of the Texas House of Representatives.
According to the revised indictment, Paxton convinced fellow Texas Representative Byron Cook (R-,Corsicana) and Florida Businessman Joel Hochberg to buy over $600,000 of Severgy stock. Severgy in turn, compensated Paxton with $100,000 in the company’s stock, with Paxton failing to disclose his compensation to the buyers. The indictment also alleges that Paxton “rendered services as an investment adviser representative” without proper credentials in 2012. Paxton admitted to the latter charge in 2014, claiming that his failure to register as an investment advisor was an accidental oversight, and paying a $1,000 fine. The Texas Rangers were in charge of the investigation, with Houston-based star defense attorneys-turned special prosecutors Brain Wice and Kent Schaffer issuing both the original and revised indictments.
In a statement released Tuesday evening, Wice wrote that “It is not unusual in any felony case, particularly fraud cases, for prosecutors to ask the grand jury to re-indict so as to provide sufficient notice to the accused as to the nature of the criminal conduct with which he is charged.” According to Dallas defense attorney Joe Borden, “It tells me they might have rushed to get this in to the grand jury and missed some language they were supposed to have in there, is probably the most likely explanation.” Borden added, “They’re used to defending against indictments. Some things got missed, and to their credit, they went back and corrected them pretty quickly.” Former federal prosecutor Joe Helms also said the re-issue is not surprising for an indictment of this magnitude, saying “I don’t think that it means that the original indictment was defective.”
Paxton’s legal team was quick to pounce on the revision, however, with attorney Joe Kendall releasing a statement saying “This confirms that there have been troubling issues with the Grand Jury process from the beginning. They had months to investigate and then rushed to indict. Now, the special prosecutors are back to clean up the botched indictments. It should make every fair-minded person question the process in this case.” In Tuesday’s statement, however, Wice refuted Kendall’s argument, arguing that the re-issued indictment was geared “to defuse the boilerplate arguments predictably advanced by the defense that the original indictments lacked specificity or were otherwise ambiguous.”
In addition to Kendall, a former federal judge, Paxton added noted Dallas defense attorney Peter Schulte to his legal team. Paxton was elected Attorney General after serving in the Texas Senate from 2013, until assuming the position in January 2015. Despite calls from Democrats to resign, Paxton has remained at his position, with a Texas Republican party spokesman calling the original indictment the product of a “sloppy process.”
Dallas Morning News – Gromer Jeffers Jr.
NBC News DFW – Scott Gordon
WFAA/ABC8 – Jason Whitely and Tanya Eiserer