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BREAKING: Texas GOP Attorney General Ken Paxton Charged With Securities Fraud

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Paxton Is Accused of Raising $840,000 for a Tech Company and Receiving 100,000 Shares of Stock in Exchange Without Disclosing the Commission

Texas Republican Attorney General Ken Paxton on Monday was charged with securities fraud in federal court. The U.S. Securities and Exchange Commission alleges in court documents that Paxton and one other man were paid commissions by Servergy, a technology company, “to promote the company to potential investors. Neither White nor Paxton disclosed their arrangements to prospective investors.” Servergy and its founder are also being charged. 

The Texas Tribune reports today’s charges “are similar to the allegations Paxton faces in a pending indictment handed up by a Collin County grand jury last year.”

The SEC alleges that while “serving in the Texas House of Representatives, Paxton allegedly reached an agreement,” a press release states, “to promote Servergy to prospective investors in return for shares of Servergy stock.” 

“Paxton raised $840,000 in investor funds for Servergy and received 100,000 shares of stock in return, but never disclosed his commissions to prospective investors while recruiting them.”

“People recruiting investors have a legal obligation to disclose any compensation they are receiving to promote a stock, and we allege that Paxton and White concealed the compensation they were receiving for touting Servergy’s product,” Shamoil T. Shipchandler, Director of the SEC’s Fort Worth Regional Office, said in the statement.

In August of 2015, Paxton was arrested and booked on two first-degree securities fraud charges, and one charge of third-degree failure to register with the State Securities Board. First-degree felony charges carry a sentence of 5 to 99 years if convicted.

Paxton has taken an activist stance against LGBT people and their civil rights, and seems intent on using his religion in addition to his office, as tools to do so.

UPDATE I: 2:36 PM EDT –
From today’s court filing:

From November 2009 to September 2013 Servergy “raised approximately $26 million in private securities offerings to develop what it claimed was a revolutionary new server, the Cleantech-1000.”

“In oral and written communications with prospective investors, and in Servergy’s February 2013 Private Placement Memorandum (“PPM”), Servergy’s co-founder and then-CEO and Chairman William E. Mapp, III (“Mapp”) led investors to believe that the CTS-1000 was in high demand by falsely claiming notable companies like Amazon.com and Freescale Semiconductors had pre-ordered the product.”

“In addition, Mapp claimed the CTS-1000 consumed up to 80% less power than other servers and that it was positioned to compete with servers from industry leaders like Hewlett Packard, IBM, and Dell for use in large data centers. Mapp had no reasonable basis for these claims and failed to disclose that, in reality, the CTS-1000 was based on outdated technology that was being phased out of the industry.”

“As part of its fundraising efforts, Servergy paid Caleb J. White (“White”) and Warren K. Paxton, Jr. (“Paxton”) commissions to promote the company to potential investors. Neither White nor Paxton disclosed their arrangements to prospective investors.”

 

 

EARLIER:

Texas AG Ken Paxton Headlines Anti-Gay Marriage And Religious Freedom Event

Ken Paxton May Face Contempt Charges For Refusing To Include Man’s Husband On Death Certificate

Ken Paxton: Repealing Nondiscrimination Law ‘Victory For Houston Pastors’ And ‘Religious Liberty’

 

This is a breaking news and developing story. Details may change. This story will be updated, and NCRM will likely publish follow-up stories on this news. Stay tuned and refresh for updates.

 

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News

Gag Order Breach? Trump Targeted Cohen in Taped Interview Hours Before Contempt Hearing

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April 24, 2024

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Hours before his attorneys would mount a defense on Tuesday claiming he had not violated his gag order Donald Trump might have done just that in a 12-minute taped interview that morning, which did not air until later that day. It will be up to Judge Juan Merchan to make that decision, if prosecutors add it to their contempt request.

Prosecutors in Manhattan District Attorney Alvin Bragg’s office told Judge Juan Merchan that the ex-president violated the gag order ten times, via posts on his Truth Social platform, and are asking he be held in contempt. While the judge has yet to rule, he did not appear moved by their arguments. At one point, Judge Merchan told Trump’s lead lawyer Todd Blanche he was “losing all credibility” with the court.

And while Judge Merchan directed defense attorneys to provide a detailed timeline surrounding Trump’s Truth Social posts to prove he had not violated the gag order, Trump in an interview with a local television station appeared to have done so.

READ MORE: ‘They Will Have Thugs?’: Lara Trump’s Claim RNC Will ‘Physically Handle the Ballots’ Stuns

The gag order bars Trump from “commenting or causing others to comment on potential witnesses in the case, prospective jurors, court staff, lawyers in the district attorney’s office and the relatives of any counsel or court staffer, as CBS News reported.

“The threat is very real,” Judge Merchan wrote when he expanded the gag order. “Admonitions are not enough, nor is reliance on self-restraint. The average observer, must now, after hearing Defendant’s recent attacks, draw the conclusion that if they become involved in these proceedings, even tangentially, they should worry not only for themselves, but for their loved ones as well. Such concerns will undoubtedly interfere with the fair administration of justice and constitutes a direct attack on the Rule of Law itself.”

Tuesday morning, Trump told ABC Philadelphia’s Action News reporter Walter Perez, “Michael Cohen is a convicted liar. He’s got no credibility whatsoever.”

He repeated that Cohen is a “convicted liar,” and insisted he “was a lawyer for many people, not just me.”

READ MORE: ‘Old and Tired and Mad’: Trump’s Demeanor in Court Detailed by Rachel Maddow

Since Cohen is a witness in Trump’s New York criminal case, Judge Merchan might decide Trump’s remarks during that interview violated the gag order, if prosecutors bring the video to his attention.

Enter attorney George Conway, who has been attending Trump’s New York trial.

Conway reposted a clip of the video, tagged Manhattan District Attorney Bragg, writing: “cc: @ManhattanDA, for your proposed order to show cause why the defendant in 𝘗𝘦𝘰𝘱𝘭𝘦 𝘷. 𝘛𝘳𝘶𝘮𝘱 should not spend some quiet time in lockup.”

Trump has been criminally indicted in four separate cases and is facing a total of 88 felony charges, including 34 in this New York criminal trial for alleged falsification of business records to hide payments of “hush money” to an adult film actress and one other woman, in an alleged effort to suppress their stories and protect his 2016 presidential campaign, which experts say is election interference.

Watch the video below or at this link.

READ MORE: ‘Blood on Your Hands’: Tennessee Republicans OK Arming Teachers After Deadly School Shooting

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OPINION

‘They Will Have Thugs?’: Lara Trump’s Claim RNC Will ‘Physically Handle the Ballots’ Stuns

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April 24, 2024

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Minutes before Donald Trump addressed his MAGA crowd at the Ellipse on January 6, 2021 his daughter-in-law, Lara Trump spoke to his supporters, vowing to “take our country back” because the Trump “family didn’t get in this fight for just four years. We are in this fight to the bitter end.”

Fast forward to April, 2024.

Lara Trump is now co-chair of the Republican National Committee, after Donald Trump’s efforts to install her and his hand-picked RNC chairman, Michael Whatley. Whatley is a North Carolina Republican who served on George W. Bush’s Florida recount team for the 2000 presidential election that was decided at the U.S. Supreme Court. Years later Whatley declared, “it was really the first time that Republicans got down into the trenches and fought,” and claimed, “if we were not there, they were going to steal it.”

Now both Michael Whatley and Lara Trump are leading the RNC, and with Donald Trump as the presumptive GOP presidential nominee, they are continuing the ex-president’s focus on “election integrity.”

Tuesday night Lara Trump served up some insight into what they’re planning.

READ MORE: Trump Complains He’s ‘Not Allowed to Talk’ as He Gripes Live on Camera

“We now have the ability at the RNC not just to have poll watchers, people standing in polling locations, but people who can physically handle the ballots. We want people all across this country –” she said before host Eric Bolling interrupted her.

“I want to hear this, this is really fascinating to me,” Bolling said. “You have 100,000 people who are, I think I saw paid at one point, but whatever – irrelevant, but, so they will be stationed inside polling places? I didn’t even know you can do that. Tell us about it.”

Trump replied, “there was a moratorium for about 40 years on the RNC actually training people to work in these polling locations in the tabulation centers where the mail-in ballots come in. And last year, the judge who implemented that passed away, so that was lifted, and that gives us a great ability as we head into what I assume everyone understands is the most important election of our lifetime.”

Bolling went on to ask, “Will these people, will they be allowed to physically handle the ballots as well, Lara?”

“Yup,” Trump replied. “And that means Eric that they should know and they can count how many ballots come in, and how many ballots should go out of every single polling location.”

READ MORE: ‘I’m Not Suicidal’: Kari Lake Pushes Hillary Clinton Murder Conspiracy Theory

She went on to say if anyone cheats, “we will prosecute you to the full extent of the law.”

“It is not worth it to cheat in a federal election, that is a crime my friends you do not want to commit.”

Bolling was referring to the more than 100,000 attorneys and volunteers the RNC reportedly has lined up to monitor vote counting. In a joint statement the Trump campaign and the RNC called it, “the most extensive and monumental election integrity program in the nation’s history.”

Former RNC Chairman Michael Steele blasted Lara Trump.

“Lara, you know why there was ‘a moratorium on the RNC for 40 years’? Because the RNC was caught cheating. The RNC was placed under a 1982 Consent decree for voter caging. Voter caging hinders an eligible voter’s ability to vote. The process involves efforts to identify and disenfranchise improperly registered voters solely on the basis of undeliverable mail. It often leads to the unwarranted purging of election rolls of otherwise eligible voters.”

“So,” Steele continued, “given the continued lies about the 2020 election and your daddy-in-law claiming if he loses in 2024 it’s because the election is rigged, you’re planning to have your people ‘physically handle the ballots’–and we’re supposed to think that’s a good idea?”

NYU professor of history Ruth Ben-Ghiat, a scholar on fascism, authoritarianism, propaganda, and the protection of democracy, also served up strong criticism.

“What does this mean, they will have thugs to physically take the ballots to make sure they are marked for Republican candidates?” Ben-Ghiat asked. “Sounds like a perfect authoritarian election plan to me.”

Watch the video above or at this link.

READ MORE: Biden Campaign Hammers Trump Over Infamous COVID Comment

 

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News

‘Blood on Your Hands’: Tennessee Republicans OK Arming Teachers After Deadly School Shooting

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21 hours ago

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April 23, 2024

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Republicans in the Tennessee House passed legislation Tuesday afternoon allowing teachers to carry concealed weapons in classrooms across the state, thirteen months after a 28-year old shooter slaughtered three children and three adults at a Christian elementary school in Nashville.

The measure is reportedly not popular statewide, with Democrats, teachers, and parents from the school, Covenant Elementary, largely opposed. The Republican Speaker of the House, Cameron Sexton, at one point literally shut down debate on the bill by shutting off a Democratic lawmaker’s microphone and then smiling.

Ultimately, Republican Rep. Ryan Williams’s legislation passed the GOP majority House as protestors in the gallery shouted their objections: “Blood on your hands.”

READ MORE: Trump Complains He’s ‘Not Allowed to Talk’ as He Gripes Live on Camera

The legislation bars parents from being informed if their child’s teacher has a gun in the classroom.

State Troopers were called to “prevent people from getting close to the House chambers,” WSMV’s Marissa Sulek reports.

“You’re going to kill kids,” one woman had yelled at Rep. Williams from the gallery on Monday, The Tennessean reports. “You’re going to be responsible for the death of children. Shame on you.”

READ MORE: Biden Campaign Hammers Trump Over Infamous COVID Comment

Democratic state Rep. Justin Jones said on social media, “This is what fascism looks like.”

“In recent weeks,” the paper also reports, “parents of school shooting survivors, students and gun-reform advocates have heavily lobbied against the bill, with one Covenant School mom delivering a letter to the House on Monday with more than 5,300 signatures asking lawmakers to kill the bill.”

The bill, which already passed the state Senate, now heads to Republican Governor Bill Lee’s desk. He is expected to sign it into law.

Watch the videos above or at this link.

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