AG Ken Paxton closes controversial investigation of Austin mogul’s claims; FBI to look into ethical concerns

Investigations

AUSTIN (KXAN) – Texas Attorney General Ken Paxton is ending a controversial investigation that had top aides accusing him of bribery and misconduct.

The investigation came from a complaint made by Austin real estate mogul Nate Paul and was related to a raid by federal and state authorities of Paul’s home and businesses last August. Paul is a Paxton donor.

The announcement by Paxton’s office Friday afternoon comes after Travis County District Attorney Margaret Moore sent a letter distancing her office from the investigation.

“Today, Travis County notified our office it was closing their file from complainant Nate Paul,” said an emailed statement from AG Paxton’s office. “In this case, we can only investigate in response to a request for assistance from the District Attorney’s office. This investigation is now closed.”

Yet the two offices have shared slightly different stories about how Paul’s complaint made it onto their radar.

Moore’s Office said Paxton personally approached DA representatives in June and asked them to hear the complaints made by Nate Paul and his attorney.

Paxton’s office told KXAN it received a referral from the Travis County District Attorney’s Office on June 10th, asking the AG to investigate allegations of misconduct by employees of the State Securities Board, FBI, DPS, the United States Attorney’s Office for the Western District of Texas and a federal magistrate. The AG’s office did not reference a meeting initiated by Paxton prior to that referral.

But in a letter sent Friday, District Attorney Margaret Moore told Paxton “…The referral cannot and should not be used as any indication of a need for investigation, a desire on the Travis County D.A.’s part for an investigation to take place, or an endorsement of your acceptance of the referral.”

Meanwhile, Paxton proceeded to hire outside counsel for the investigation into Paul’s claims. A contract released by the AG’s office shows Paxton paid Houston prosecutor Brandon Cammack $300 an hour to investigate the allegations.

According to reports in the Houston Chronicle and Austin American-Statesman, Paxton’s aides felt compelled to report his actions after they discovered Cammack had issued subpoenas targeting “adversaries” of Paul.

Paxton maintained he hired Cammack because of his relationship to Paul.

“Because employees from my office impeded the investigation, and because I knew Nate Paul, I ultimately decided to hire an outside independent prosecutor to make his own independent determination,” Paxton wrote in a statement issued earlier this week.

Cammack declined to comment in a phone call with KXAN earlier this week and could not be reached Friday.

It’s this handling of the complaint and Paul’s involvement that have prompted accusations of bribery and abuse of office from some of Paxton’s own top attorneys.

An email sent by some of those aides and obtained by the Texas Tribune indicates they felt Paxton was overusing his investigative powers.

It reads: “This office’s continued use of the criminal process, in a matter already determined to be without merit, to benefit the personal interests of Nate Paul, is unconscionable.”

While the investigation into Paul’s concerns appears closed, the one into allegations of bribery and abuse of office will be handled by the FBI.

“The allegations have been referred to federal authorities for investigation by the FBI,” said a spokesperson with the Texas Department of Public Safety. “At this time the Texas Rangers are not involved with the investigation, but remain available to assist if necessary.”

Paul has not been charged with any crime related to the raids last August, and the exact nature of the allegations against Paxton are not yet clear. A former World Class Holdings senior employee told KXAN it was well-known that Paxton knew Paul, but that any specific wrongdoing was unknown.

Gov. Greg Abbott said in a statement to KXAN Sunday the “allegations raise serious concerns,” but that he wouldn’t comment further until the results of any investigation were complete.

KXAN’s David Barer and Chelsea Moreno contributed to this report.

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