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A Breakdown Of Ken Paxton's Alleged Crimes
Misconduct, misuse of office, bribery, and unethical conduct were all terms used during the House Investigation Committee meeting.
This week, it’s possible articles of impeachment will be filed against Attorney General Ken Paxton. Whether the House will vote to impeach and the Senate votes to convict remains to be seen. However, after yesterday’s House General Investigating Committee’s (GIC) public hearing, we should expect to see the articles filed as soon as today. So let’s get into it.
The GIC has been investigating Paxton over the last two months and the settlement of $3.3 million related to a lawsuit involving General Paxton and terminated employees. The settlement was made before approval from the Texas legislature and obligated taxpayers to pay the amount; however, it has not been paid out yet.
When the allegations occurred, the House Committee inquired into the settlement, focusing on the evidence and policies of the Office of the Attorney General (OAG) in 2020. The investigation was carried out by six highly experienced lawyers and investigators with backgrounds in criminal law and public integrity, Erin Epley, Therese Boose, Mark Donnelly, Donna Cameron, Dan McAnulty, and Brian Benken.
The investigation was opened after Paxton asked the legislature to pay his $3.3 million settlement on his whistle-blower case.
Before the legislature committed to spending taxpayer dollars, they wanted to see if something was there. So it wasn’t about funding, proving, or disproving the case but whether or not the Attorney General (AG) committed these alleged crimes.
Four allegations were investigated:
First, Ken Paxton directed actions against a charitable organization, the Mitte Foundation, at the behest of a political donor.
Paxton directed actions against the standard law enforcement protection afforded to ongoing investigations to benefit the same donor.
Paxton directed action outside law enforcement protocol on baseless allegations outside the OAG. Paxton also hired a henchman to work on his behalf and report directly to him, which was done outside of the lawful jurisdiction of the Attorney General. This was also done to benefit the same donor.
The retaliation by General Paxton towards those who reported wrongdoing.
The donor was an Austin real estate investor, the CEO of World Class Holdings, and a friend of Paxton, Nate Paul, who contributed $25,000 to General Paxton’s campaign fund in October 2018. In addition, connections between Paul, the Mitte Foundation, and ongoing litigation exist.
Nate Paul and the Mitte Foundation.
While once Paul’s commercial properties were estimated at $800 million, by 2019, 18 of his companies had declared bankruptcy. He faced at least 13 foreclosures on his properties and was entangled in several lawsuits.
In December 2018, only two months after Paul’s contribution to Paxton, the Mitte Foundation sued World Class Holdings and Nate Paul. The lawsuit was related to fraud after he refused to make financial disclosures about endowment money the nonprofit had invested in his businesses in 2011.
In August 2019, the FBI and DPS executed a search warrant for Paul’s businesses and residents. Paul wanted access to those search warrant affidavits or the paperwork related to probable cause. However, he couldn’t obtain those documents because they were under court seal.
In December 2019, Paxton asked his Deputy Attorney General for legal council regarding a disputed open records request from a Dallas Law Firm regarding Nate Paul and the Texas Securities Board in cooperation with the FBI, DPS, and other federal and state law enforcement agencies.
Paxton had expressed that he thought it was “unfair” that Paul couldn’t access his search warrant information, and he knew what it was like to be mistreated by law enforcement.
The Deputy AG thought the request was strange, so he Googled Nate Paul and learned about his legal trouble and bankruptcies. This allegedly raised a red flag with the Deputy.
Then, Paxton had a lengthy meeting with the OAG’s Open Records Chief, who told him that the determination not to release those records was correct. The Chief reported to investigators that this was the first time that Paxton had ever expressed such interest in an open request file. However, after that, there were two more times Paxton inquired into the same type of information, each involving the investigation against Nate Paul.
When a new Deputy AG was appointed over the open records division in March 2020, Paxton requested the open records file on Paul. Although the FBI and DPS wanted to shield the information in those documents, the complete, unredacted copies of the file were eventually handed over to Paxton. At that time, Paxton was told that disclosure of the records violated the law.
Paxton’s involvement with Nate Paul.
In the summer of 2020, Paxton’s aid was asked to deliver a manila envelope containing several sheets of paper to Nate Paul in Austin. In that envelope was the unredacted version of the FBI search warrant. After that, Paul’s attorneys stopped making requests for information.
Attorney General Paxton is the Chief Law Enforcement Officer of the State of Texas, who is in charge of applying the law. However, he pushed his staff to ignore the law and legal precedent by using his office to obtain the information his friend and political donor sought.
It’s important to understand that under Texas State Property Code, the state government is supposed to aid charitable organizations in need and that the OAG is supposed to represent public interests. So, when charitable organizations are involved, the OAG is supposed to be on their side. However, Paxton took a stance against the Mitte Foundation.
Nate Paul was supposed to have paid Mitte Foundation a $10.5 million settlement on August 20, 2019. However, the FBI executed their search warrants only four days before, and the payment never happened.
In December 2019, the Mitte Foundation notified the OAG of the lawsuit, and the attorneys in the Charitable Trust Division determined that there was no need for involvement. Accordingly, on January 31, 2020, they filed a written notice with the district court about not being involved.
Despite that, in early 2020, Ken Paxton asked his executive staff to evaluate the lawsuit to see if there should be an intervention. That’s when the Financial Division Chief in the OAG looked into the matter, saw the FBI was already investigating, and determined that the OAG should not be involved. This was the second time Paxton was told not to get involved.
Paxton also disagreed with that assessment and insisted that the Financial Division Chief intervene and find a way to facilitate a settlement.
A formal notice to petition an intervention was filed on June 8, 2020.
On July 6, 2020, the Deputy AG for Policy and Strategy called Paxton while he was on vacation and advised him to have nothing to do with Nate Paul and reiterated that the OAG should not be involved.
Only two weeks later, Paxton met with four executive staff members and insisted that he appear in District Court to argue the case himself, something he had never done before.
If you remember, in the summer of 2020, Covid was spreading like wildfire and had taken our nation by storm. The OAG staffers were alarmed that Paxton was spending so much time and resources on a charitable case against a man already under federal indictment during this time.
Paxton ordered his staff to file a motion to stay, which sent the case into mediation. This was also unusual since the case had already been through arbitration and mediation. Then, Nate Paul’s sister, who was also his attorney, and an employee from the OAG, pressured the Mitte Foundation lawyer to settle on less than half of the original settlement offer. The Mitte Foundation refused this offer.
Policy was not followed, and the AG worked against the charity.
The OAG and the Mitte Foundation should have been on the same side, and there was no benefit to this charitable organization by the OAG’s involvement. Paxton’s involvement was for the sole benefit of Nate Paul.
However, the OAG withdrew from this litigation immediately before the whistle-blower letter became public.
After that, as part of the ongoing trial preparations, Nate Paul was deposed by the Mitte Foundation’s attorney when it was established that Paul hired a woman Paxton recommended. The woman was identified by OAG executive staff as Ken Paxton’s mistress. The investigators reported that Angela Paxton became aware of the affair in 2019, which ended briefly, but Ken Paxton and his mistress were soon a couple again.
During the lawsuit, Nate Paul was held in contempt of court and sentenced to jail for violating court orders of financial disclosure and lying under oath.
On Friday, July 31, 2020, Paxton contacted a senior staff member to research whether or not an in-person foreclosure sale violated Covid restrictions. In addition, he wanted the opinion done by the end of the weekend, which was another unusual request, as these opinions usually take 180 days.
As it turned out, according to the whistle-blowers, Paxton wanted an opinion in two days when it would typically take six months was related to foreclosure sales of specific properties of Nate Paul.
Around the same time, there is a finding of a $21 million judgment to be executed on the Mitte Foundation’s behalf. So, the investigators said it was an easy assumption that the monies from the sale of those foreclosures were to go to the Mitte Foundation.
The properties were set to foreclose on Tuesday following the OAG opinion regarding in-person foreclosure sales and Covid. Paul’s attorneys used the opinion letter to stop the sale of 13 additional properties in August 2020. This was when senior staff in the OAG learned about the opinion being for the benefit of Paul.
In May and June 2020, Paxton contacted the Travis County District Attorney’s office on behalf of Nate Paul and requested a lunch where Paul would be present. It was again expressed how irregular it was for the AG to be involved in a complaint of this size and offer a personal introduction of the complainant to two senior members at the Travis County DA’s office.
The staff members reported to the DA that they directed Paul to other organizations that may have been better suited to help him, including the Inspector General, the Civil Rights Division of the DOJ, and others. They offered Paul a complaint form, which he declined.
Later, Paul submitted an unsworn written complaint about how he had been mistreated in his legal proceedings. The Travis County DA’s office was unmoved and found no merit or credible crime. However, the Travis County DA felt the complaint had come directly from Ken Paxton.
Nate Paul pushed for more meetings with OAG staff. After they initially refused, Paul insisted that Paxton told him the OAG could handle his legal matters. Paul alleged that federal entities had tampered with the documents in his case, but when he produced the documents, forensic experts in the OAG determined that no tampering had occurred.
Paxton was repeatedly warned about his continued involvement with Paul and business dealings.
Another meeting with OAG staff and Paul was set up. When the staff informed him that there was no evidence of a crime they could investigate and they were closing the case, Paul dressed down the staff as if they were his employees.
A few weeks later, the staff learned that Ken Paxton was seeking outside counsel. It was the first time Paxton had ever personally hired an outside attorney on behalf of the OAG.
Paxton hired Brandon Cammack, a five-year attorney out of Houston with no prosecutorial experience. Cammack was not vetted, didn’t go through a background check, didn’t fill out any paperwork with HR, and reported directly to Ken Paxton.
A budget of $25,000 was set aside to pay Cammack, although it was unclear how much he received. However, senior staff members in the OAG refused to sign a contract for Cammack to investigate the matter because it is against prosecutorial ethics to investigate a case without merit.
On September 23, 2020, Cammack called the OAG and asked for something that showed he was working for them. At that time, he was told his contract had not been approved. Paxton instructed OAG staff to sign the contract, and the staff refused. After that, however, Paxton hired Cammack off of the books.
Cammack was directed to investigate the FBI regarding their dealings with Nate Paul.
Paxton was warned again by OAG staff about how he was exposing himself to criminal liability, but by that point, Cammack had already been working on the case for two weeks. Nevertheless, Paxton told executive staff members that Cammack needed to be paid. Administrative staff responded, telling Paxton that Cammack needed to be fired immediately. Paxton assured him that he would.
What did Cammack do?
Cammack used the title “Special Prosecutor” and obtained 39 grand jury subpoenas related to Nate Paul’s complaint. Some of those subpoenas were served on banks unrelated to the Nate Paul case.
The OAG staff contacted Cammack, directed him to take no more action, and then took it upon themselves to quash all of the subpoenas, considering that Cammack was not a special prosecutor and had no legal authority to execute them.
Those subpoenas concerned law enforcement officials related to Paul’s federal investigation and banks associated with the Mitte Foundation.
When the first grand jury subpoena was received, senior staff at the OAG began asking questions. “Who is Brandon Cammack? And why is he telling people he’s a special prosecutor with the OAG?”
Senior OAG staff had no idea who he was, there was no reference to him in internal databases, and when they looked him up on social media, no one recognized him. By the time the second grand jury subpoena falls, the senior staff is in full panic mode, believing Cammack is someone who went rogue. They finally contacted Paxton, who was out of the office, and learned that Cammack was hired by him. They immediately sent a cease and desist letter to Cammack, advising him his actions were likely illegal.
At this point, Paxton had been advised several times to leave the matter alone and warned of the bribery implications and compromise of the OAG’s office. Yet, Paxton did not relent. So that’s when seven separate individuals in different departments contacted the FBI and filed a whistle-blower complaint.
These employees thought they would be protected under whistle-blower laws, and in their report to the FBI, they claimed that they believed Ken Paxton was violating federal and state law. This included improper influence, abuse of office, bribery, and other potential crimes.
Within a month, each of those employees was either fired or resigned. Retaliation for the whistle-blower complaint, which sparked the whistle-blower lawsuit.
As part of the settlement for the whistle-blower lawsuit, Ken Paxton was supposed to offer an apology and pay $3.3 million dollars, which he tried to stick on taxpayers, and is why the House opened the investigation.
Other details were revealed in the hearing.
The Committee spoke about Paxton’s security fraud charges, the multiple incidents when he failed to disclose gifts and his new granite countertops.
During 2020, the Paxton’s house needed a full renovation, including a $20,000 upgrade of granite countertops. It was alleged that Nate Paul paid for the countertops and perhaps even the entire renovation.
Is Ken Paxton’s goose cooked? Stay tuned.