Indicted Texas attorney general rode tea party to power

AP News
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Posted: Aug 04, 2015 7:35 PM
Indicted Texas attorney general rode tea party to power

AUSTIN, Texas (AP) — That newly indicted Texas Attorney General Ken Paxton may have broken securities law isn't news to voters who elected him: Blistering TV attack ads during the 2014 elections reminded them that the Republican had already admitted that.

Yet the tea party favorite clobbered an establishment Republican who heavily outspent Paxton and counted former President George W. Bush as a donor, riding a wave of conservative insurgency to become Texas' top law enforcement officer despite questions about his financial dealings.

Now barely seven months in office, Paxton's future is already murky after turning himself into jail this week on felony securities fraud charges. His attorney has said Paxton will plead not guilty.

Heavyweight admirers that include U.S. Sen. Ted Cruz are now treading carefully about the attorney general, who on Tuesday was back at work slamming Planned Parenthood with the kind of abortion-bashing that made his 2-to-1 victories in both a GOP runoff and general election so decisive. The Republican Party of Texas says it expects Paxton to harness that same zeal toward his criminal case.

But for Paxton's critics, some of whom are calling for his resign, the indictment unsealed this week was a reminder of tea party dominance in Texas.

"It's nothing I feel good about to say that I told you so," said Sam Houston, a Houston attorney and Democrat who lost the attorney general's race by 20 points to Paxton in November. "It's disappointing. The voters knew about this and elected him anyway, and by a pretty wide margin."

Last year, Paxton admitted to violating state securities laws during his Republican primary race and paid a $1,000 fine for failing to register as an investment solicitor. He described it as an administrative oversight but denied criminal wrongdoing.

In an email to supporters Tuesday, Paxton said he expects to be "fully vindicated."

"I am looking forward to the opportunity to tell my story - which the grand jury did not hear - in a court of law. Thank you for standing with me and now walking forward with me as we continue the work we came to do," Paxton wrote.

But a grand jury in Paxton's hometown of McKinney have now handed up charges that accuse the former state lawmaker of lying to wealthy investors, telling them he put his own money into a tech startup called Servergy Inc. All the while, prosecutors say, Paxton was being compensated by the company.

Servergy CEO Lance Smith said Tuesday that his predecessor paid Paxton as an adviser with stock, giving him 100,000 shares valued at $1 apiece. Smith said that from what he has gathered, Paxton's job was to help recruit investors.

"That was part of his advising role, making introductions," said Smith. He added that Paxton remains a shareholder but hasn't been active with Servergy since 2011.

In Texas, where a Democrat hasn't won a statewide office in two decades, the GOP primaries were the only competitive races of last year's elections. While Gov. Greg Abbott and Land Commissioner George P. Bush, the son of presidential candidate Jeb Bush, were too popular to attract serious challengers, Paxton's race epitomized the ongoing animus between establishment Republicans and conservative insurgents.

What side Paxton was on was clear. Cruz, who was stingy with endorsements in 2014, made a point to praise Paxton as a "tireless conservative warrior" during the primary. Influential tea party groups also flocked to Paxton and helped him clobber Dan Branch, a moderate state lawmaker who raised more money and attacked Paxton's securities fine on television. It did little good.

"The attorney general's race was the best example we had of how tides have shifted to tea party conservatives in Texas. You had the best candidate the establishment could put forward," said Mark Jones, a political science professor at Rice University. "It was a pure ideological vote."

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Follow Paul J. Weber on Twitter: www.twitter.com/pauljweber