Ken Paxton, prosecutors agree to pre-trial deal to drop felony fraud charges

Ken Paxton agrees to pre-trial intervention in Texas securities fraud case; Charges dismissed

HOUSTON — Texas Attorney General Ken Paxton agreed Tuesday morning to a pre-trial intervention program that will see state felony charges against him dropped.

In a deal between the special prosecutor and Paxton’s lawyers, the 18-month intervention program includes Paxton completing 100 hours of community service in Collin County, 15 hours of legal ethics education and paying restitution to the victims. The special prosecutor told the judge that the restitution totals just under $300,000.

The agreement does not include an admission of guilt.

The special prosecutors will monitor Paxton’s progress every 60 days, and may re-file the charges if Paxton does not abide by the terms.

A former special state prosecutor in the case, Kent Schaffer, told CBS News Texas it’s common.

Schaffer said Paxton is not getting a special deal and that this is typical in large counties such as Harris and Collin, where the charges originally came from, and Dallas, Tarrant and Travis as well. 

When asked if the public should be surprised by the deal, Schaffer said, “No, they shouldn’t be surprised. When we indicted this case, we understood this very realistic possibility that even if Paxton was convicted, a jury probably wouldn’t put him in prison. He’d be a convicted felon, but we always presumed he would get probation. It’s a high-profile case but if a lawyer, stockbroker, bus driver, a schoolteacher, pre-trial diversion would probably be the first thing a District Attorney would offer.”

The case was first filed against Paxton in 2015 after he was elected attorney general but involves allegations from before his election to statewide office.

Paxton is facing a third-degree felony for allegedly failing to file paperwork that he was a securities adviser.

He was also initially charged with two first-degree felonies of securities fraud, but Schaffer said one of those charges has been dropped because one of the victims died.

According to Schaffer, Paxton is accused of failing to disclose to investors that he was making a commission on certain investments they made and that, unlike previous occasions, he was not contributing his own money to those same investments.

Schaffer quit the case last month because he and the current special prosecutor haven’t gotten paid in years because of an ongoing dispute with Collin County, and this issue remains tied up in the appeals court.

There have been other delays too including Paxton’s decision to fight moving the case from Collin County to Harris County.

The current special prosecutor, Brian Wice, isn’t commenting on the potential deal. 

Paxton has repeatedly denied any wrongdoing. 

His attorney, Dan Cogdell, hasn’t returned our call but will speak with reporters after the hearing Tuesday morning. 

Paxton was impeached last fall by the Texas House and acquitted by the Texas Senate after a trial. 

He reportedly remains under federal investigation. 

Paxton also faces a whistleblower lawsuit filed against him by his former top lieutenants who were fired after they went to the FBI more than three years ago to report potential bribery allegations against him. He has also denied any wrongdoing in that case.

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