Ken Paxton sat for hours in a federal constructing in Fort Price as authorities legal professionals grilled him underneath oath about his rising wealth and questionable investing historical past.
On the time, in December 2014, Mr. Paxton was a fast-rising Republican star. He had simply been elected the following lawyer common of Texas. However outdoors of public view, he was underneath scrutiny as a part of a federal investigation into doable fraud.
The deposition within the case, obtained by The New York Instances, was one of many earliest episodes in what would turn out to be a decade-long sample for Mr. Paxton: accusations of corruption and different unlawful conduct repeatedly emerged, solely to be resolved and not using a conviction.
Now, as Mr. Paxton is locked in a fierce Senate race in Texas, the deposition gives a beforehand unseen account of his funds, his perspective towards cash and the way he used his connections inside the State Legislature to amass his wealth.
Since his first election to public workplace in 2002, Mr. Paxton has grown his wealth by enterprise investments and actual property purchases into a private fortune with a reported worth of as much as $23 million. His belongings now embody a number of mutual funds, a cellphone tower and 15 properties throughout six states.
Mr. Paxton has hardly ever answered questions publicly about how he accrued this wealth on a authorities wage. His funds have been the topic of repeated investigations by native, state and federal authorities into alleged bribery, fraud and self-dealing. The difficulty has been a frequent line of assault from his political opponents, together with James Talarico, the Democratic state lawmaker operating in opposition to him for Senate.
The 2014 deposition was a part of a U.S. Securities and Alternate Fee investigation into Servergy Inc., a know-how start-up based mostly in McKinney, Texas, which is a part of the district that Mr. Paxton represented as a state lawmaker. The beginning-up’s founder, William Mapp III, generally known as Invoice, was accused of creating false claims to buyers.
The S.E.C.’s legal professionals needed to know whether or not Mr. Paxton hid that he had acquired compensation for recruiting buyers for the corporate.
The S.E.C. finally introduced civil fraud costs in opposition to Mr. Paxton that had been dismissed. Along with the federal inquiry, Mr. Paxton was indicted by a grand jury on state securities fraud costs in 2015. In 2024, he reached a deal to keep away from trial whereas admitting no wrongdoing.
Underneath oath in 2014, Mr. Paxton informed the federal legal professionals that he had invested greater than $400,000 in varied corporations. However between legislating and campaigning, he stated he didn’t have time to trace his investments. In actual fact, Mr. Paxton stated, he couldn’t find inventory certificates doubtlessly value $200,000.
“I’m so busy,” he stated within the deposition, “I don’t all the time maintain observe of this sort of stuff.”
The deposition additionally shed extra gentle on how he defended himself in opposition to the securities fraud allegations, which he spent the following decade preventing. Mr. Paxton used phrases like “I don’t bear in mind” or “I don’t recall” greater than 200 instances when addressing questions. He additionally tried to deflect to different males he invested with and to his spouse, Angela.
“I haven’t ready a tax return in a very long time as a result of I don’t have time, so sometimes — really my spouse really does them,” Mr. Paxton stated, when requested a few line in his tax returns that appeared to contradict a part of his testimony.
Nick Maddux, a senior adviser to Mr. Paxton, stated the discharge of the deposition was meant to distract from the election and Mr. Paxton’s opponent.
“This can be a 12-year-old deposition a few case that ended and not using a conviction, handed to the press by a political opponent lower than a month earlier than Election Day,” Mr. Maddux stated. “Like President Trump, the lawyer common has been politically persecuted for years for standing as much as the institution, and Texans have seen by it each time.”
The Instances obtained the December 2014 deposition from an individual who opposes Mr. Paxton’s election to the Senate. The Instances independently confirmed its authenticity.
Mr. Paxton has been questioned underneath oath at the least thrice prior to now decade, however not one of the depositions had been public.
The Talarico marketing campaign has sought the discharge of two depositions that Mr. Paxton gave in a unique case. A lawyer representing Mr. Paxton’s wealth supervisor is preventing to maintain them sealed.
Mr. Paxton’s recounting of the Servergy transaction started at a Dairy Queen in McKinney. Within the deposition, he stated he supposed to speculate $100,000 in Servergy and met Mr. Mapp there to present him a verify. Mr. Mapp turned down the cash, Mr. Paxton stated, and as a substitute gifted him 100,000 shares of inventory.
Mr. Paxton attributed Mr. Mapp’s generosity to his spiritual beliefs.
“I stated, Nicely, who do I make the take a look at to?” Mr. Paxton informed the federal government legal professionals, in keeping with the deposition. “He stated, I can’t take your cash. God doesn’t need me to take your cash.”
The worth of the shares finally grew to $200,000, in keeping with Mr. Mapp’s emails to Mr. Paxton that had been described within the deposition.
The federal government’s legal professionals requested why Mr. Mapp, who was actively looking for different buyers, would give Mr. Paxton shares free of charge.
“It was not logical,” Mr. Paxton responded within the deposition, earlier than including that “Invoice is a religious individual.”
Mr. Paxton stated he didn’t ask a lawyer whether or not it was “acceptable” to just accept the shares.
He listed the shares as inventory he held or acquired on his annual monetary stories filed with state ethics regulators. Andrew Cates, an professional in Texas ethics legal guidelines, stated Mr. Paxton could have violated state guidelines by not additionally disclosing that the shares had been a present.
Mr. Paxton informed the federal government legal professionals that he couldn’t bear in mind the placement of the certificates proving he owned the inventory. He stated he was too busy taking his daughter to go to schools and making ready to be lawyer common.
Mr. Paxton’s testimony supplied new perception into what he stated was a hands-off strategy to investing that helped develop his fortune as a state lawmaker.
Given his busy schedule, Mr. Paxton stated he would delegate funding pitches to a member of his legislative workers.
The aide would take a look at the pitch and resolve whether or not or to not think about it, Mr. Paxton stated. Mr. Paxton stated he would typically run the thought by Byron Prepare dinner, a Republican lawmaker within the Texas Home on the time who had based a profitable online game firm, and different businessmen he knew who invested collectively.
“That’s been my technique,” Mr. Paxton stated, “depend on different people who know these things higher than I do.”
On the time of the deposition, Mr. Paxton had investments in additional than two dozen completely different companies. He mentioned a handful of these companies in his testimony, saying he had invested between $50,000 and $175,000 in every. One funding noticed a return of $250,000.
Mr. Paxton would finally place lots of his belongings in a blind belief after questions over potential conflicts of curiosity had been raised.
The connection between Mr. Prepare dinner and Mr. Paxton didn’t final. In 2015, Mr. Prepare dinner accused Mr. Paxton of steering him and others into investing in Servergy with out disclosing that he had acquired compensation.
The accusation was a part of the legal indictment in state courtroom. Mr. Paxton reached a cope with prosecutors in 2024 to pay Mr. Prepare dinner and one other investor about $300,000 in restitution and carry out group service. By a lawyer, Mr. Prepare dinner didn’t reply to requests for remark.
Servergy finally paid a $200,000 penalty to settle separate federal civil fraud costs unrelated to Mr. Paxton. Mr. Mapp misplaced his job and has averted a public profile since then. He couldn’t be reached for remark.
Federal legal professionals questioned Mr. Paxton about emails central to their fraud case during which Mr. Mapp appeared to supply him a fee for recruiting new buyers. Mr. Paxton stated he didn’t bear in mind studying lots of Mr. Mapp’s emails and insisted he didn’t carry out companies for the corporate.
When confronted with a replica of his personal tax returns, on which the federal government’s legal professionals stated Mr. Paxton had disclosed $100,000 for “authorized companies” to Servergy, Mr. Paxton directed the legal professionals to his spouse, who he stated ready the shape.
Now a state senator, Mrs. Paxton filed for divorce in 2025, accusing Mr. Paxton of adultery. She declined to remark for this text.
A federal decide dismissed the S.E.C.’s fraud case in opposition to Mr. Paxton in 2017, ruling that he was underneath no obligation to inform buyers that he had acquired one thing of worth from Mr. Mapp.
Mr. Paxton stated within the deposition that he by no means had cause to doubt Mr. Mapp’s statements that the corporate would achieve success.
“I are inclined to belief individuals till they show in any other case,” Mr. Paxton stated. “As soon as they lie, then you’ve got a complete completely different situation. That’s what’s so troublesome about individuals not telling the reality.”