Texas AG Ken Paxton reaches deal to end securities fraud charges after 9 years

HOUSTON — Texas Attorney General Ken Paxton on Tuesday agreed to pay nearly $300,000 in restitution under a deal to end criminal securities fraud charges that have shadowed the Republican for nearly a decade.

The announcement by special prosecutors in a Houston courtroom came less than three weeks before Paxton was set to stand trial on felony charges that could have led to a prison sentence. It was the closest Paxton — who was indicted in 2015 — has ever come to trial over accusations that he duped investors in a tech startup near Dallas.

Under the 18-month agreement, the special prosecutors would drop three felony counts against Paxton as long as he pays full restitution to his victims, and completes 100 hours of community service and 15 hours of legal ethics education. A former special prosecutor said the chance of a conviction was going to be “50-50.”

Paxton said little during the hearing, and he avoided reporters by leaving the court through a back door.

But in a statement released later Tuesday, Paxton — one of the nation’s most prominent state attorney generals, who just six months earlier was acquitted of corruption charges in an impeachment trial in the Texas Senate — remained defiant.

“There will never be a conviction in this case nor am I guilty,” said Paxton, while thanking his family and supporters “for sticking by my side.” The agreement lets Paxton remain in his elected position and doesn’t affect his law license.

Dan Cogdell, a Paxton’s attorney, said prosecutors would never have been able to prove their case at trial, but he conceded that it was cheaper for Paxton to accept the agreement.

“Number one, the economics are actually in his favor for not going to trial. And number two, it’s a guaranteed dismissal at the end of the day,” Cogdell told reporters.

Houston attorney Brian Wice, who was one of the special prosecutors, described the deal as a victory that requires Paxton to repay investors, including Byron Cook, a former GOP lawmaker who served with Paxton in the Texas Legislature, and the estate of Joel Hochberg, a South Florida businessman who died last year.

Wice, who previously indicated that he would consider a pre-trial deal a “slap on the wrist,” said he and fellow prosecutor Jed Silverman reevaluated their chance of success based on evidence and witnesses.

“Our primary duty is to do justice, not to convict. So, the question isn’t whether or not who won, but was justice served? And I think the answer to that is unmistakably yes,” Wice said.

The Cook and Hochberg families said in a statement they are “grateful that they will receive restitution in full.”