Texas AG Ken Paxton reaches deal, avoids trial in securities fraud case

Texas Attorney General Ken Paxton has dodged criminal prosecution in a long-running felony securities fraud case, agreeing to community service to avoid a trial and conviction.

Why it matters: The agreement with prosecutors appears to be an anticlimactic end to the case — and allows Paxton to maintain an unblemished record, even as he has faced myriad accusations of corruption.

Catch up quick: Paxton was indicted on securities fraud charges shortly after he first took office as attorney general in 2015.

• Paxton faced allegations that he had convinced investors, including then-Republican state lawmaker Byron Cook, to purchase at least $100,000 worth of stock in a tech startup, Servergy, without disclosing that he would be paid for it.
• The case was delayed by pretrial disputes between defense lawyers and prosecutors, including over where the trial would take place.

Driving the news: Prosecutors on Tuesday agreed to drop the securities fraud charges if Paxton performs 100 hours of community service.

• The agreement also requires him to take legal ethics courses and pay "almost $300,000 in restitution," prosecutor Brian Wice said , to those he is accused of defrauding.
• Paxton will not have to enter a plea under the terms of the agreement.

Speaking to reporters in Houston on Tuesday, Paxton attorney Dan Cogdell said Paxton was "more than happy to comply" with the terms of the dismissal.

• "But let me be clear, at no time was he going to enter any plea bargain agreement or admit to conduct that simply did not occur," Cogdell said in a statement.
• Wice said he had received a torrent of critical calls after a potential deal was revealed .
• "Your truth is not the truth," Wice said about what was known to the general public compared to prosecutors. "You know one half of 1% of what [we] know about the facts of these cases."
• "We are confident that a rational Harris County jury would have found our proof sufficient beyond a reasonable doubt, but you know what, that's why God built a courthouse, because you never know," Wice continued in remarks to reporters.

What they're saying: "​​Something is wrong when the state's top lawyer is forced to take a class on how to be a good lawyer," John Bucy III, a Democratic state lawmaker representing Austin, wrote on X .

Between the lines: Paxton is still facing a whistleblower lawsuit from former aides who claim they were improperly fired for reporting him to the FBI on corruption allegations.

• The claims are part of an ongoing federal investigation that began as early as 2020 .
• Paxton has denied any wrongdoing.

What's next: Avoiding trial sets Paxton up for a potential primary run against U.S. Sen. John Cornyn in 2026 or for service in a Trump White House … assuming federal prosecutors don't come after him first .

The bottom line: With the agreement, Paxton, who was acquitted of corruption impeachment charges by the Texas Senate last year, avoids the potential of a prison sentence and being barred from future runs for office in Texas.

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