Nate Paul, Austin investor tied to AG Paxton, charged with 8 federal counts
Editor’s Note: The above video is previous KXAN coverage after Nate Paul’s arrest.
AUSTIN (KXAN) – Embattled Austin real estate investor Nate Paul – a donor and ally to impeached Attorney General Ken Paxton – has been charged in federal court with eight counts related to making false statements and false reports to mortgage lending companies and credit unions, according to court statements Friday.
Each count carries a maximum penalty of up to 30 years in prison and a fine of up to $1,000,000 if convicted, the Department of Justice said in a press release.
Gerry Morris, one of Paul’s attorneys, told KXAN that Paul denies all allegations and will be pleading not guilty.
Paul was arrested and jailed in Travis County on Thursday on a federal warrant, according to news reports and a spokesperson for the Travis County Sheriff’s Office.
The alleged violations happened between March 2017 and April 2018, the Department of Justice release stated.
The government is seeking forfeiture of Paul’s properties related to the criminal allegations, $172 million and substitute assets if the properties can’t be recovered. Paul has been released on the condition that he surrender his passport, which his attorney said in court Friday he has already done. Paul was granted the ability to travel domestically, but he must notify the court and provide an itinerary.
The government also asked for a special condition on his release, including that he can’t retaliate against any witness or threaten to do so, according to court statements.
Paul made his initial court appearance before U.S. Magistrate Judge Dustin Howell of the U.S. District Court for the Western District of Texas. He will be arraigned in his next court appearance on June 15 at 11 a.m.
Paul’s business and personal dealings with Paxton are intertwined with the attorney general’s impeachment and a pending whistleblower lawsuit. It isn’t clear if any of Paul’s legal issues are tied to the complaints against Paxton.
Nate Paul legal issues
The legal issues Paul now faces have been brewing for years.
In 2018, Paul donated $25,000 to Paxton’s campaign. In 2019, federal agents raided and searched the headquarters of Paul’s main business World Class Holdings. World Class is the overarching entity under which Paul operates dozens of businesses that control an array of real estate properties.
Forbes reported in 2017 that Paul’s companies had amassed upward of $1.7 billion in real estate assets across the country. KXAN reported in 2020 that Paul’s companies were associated with over 50 properties in Travis County valued at over $444 million, according to Travis Central Appraisal District records.
In September 2020, a group of Paxton’s top attorneys filed a complaint against him, alleging Paxton engaged in bribery, abuse of office and had intervened in cases to benefit Paul.
Roughly a month later, in November 2020, four of the complaining lawyers sued Paxton for wrongfully terminating them and retaliation.
Paxton agreed to settle the whistleblower case for $3.3 million. In March, Paxton requested the legislature approve the payment of state money to resolve the case. Lawmakers said that payment request triggered a probe by the House General Investigating Committee that uncovered violations of law and ethical obligations by Paxton and ultimately led to his impeachment.
Through court filings in the whistleblower case, and a separate civil case involving World Class companies and a charitable trust, the relationship between Paul and Paxton has become clearer and the origins of allegations tying the two together have emerged.
Source: KXAN.com
