SEC files amended charges against Attorney General Ken Paxton

Earlier this month, U.S. District Judge Amos L. Mazzant III threw out the SEC case against Paxton but gave the commission 14 days — until Friday — to file amended allegations. 

The updated charges contend that the group of investors Paxton allegedly duped when he persuaded them to invest in a tech start-up called Servergy "reasonably expected" him to disclose he was receiving a commission. According to the SEC, the members of the group had a standing policy that "no one member makes money or otherwise benefits off of the investment of another member." 

The amended allegations also amplify the SEC's argument that Paxton did not simply fail to disclose but "actively concealed" his commission agreement from the investor group. He did so, the SEC says, by not mentioning it in filings with the Texas Ethics Commission and the IRS, ignoring efforts by the group to learn about his relationship with Servergy and mischaracterizing the compensation as a kind of gift when asked about it by the SEC.

The SEC's decision Friday is the latest blow to Paxton, who's been under a legal cloud for more than a year. Earlier this month, Texas' highest criminal court declined to review the state case, making a trial likely for as early as next spring. 

Paxton's lawyers initially said they planned to again ask the Texas Court of Criminal Appeals to look at the state charges. But the likelihood of such an appeal now appears less certain, with Paxton lawyer Bill Mateja saying Wednesday that Paxton's attorneys "haven't made the decision yet."

Read more of our related coverage:

• Lawyers for the U.S. Securities and Exchange Commission received skeptical treatment in September from the federal judge who heard arguments over a bid to dismiss the civil fraud case against Attorney General Ken Paxton. 
• Paxton is appealing the securities fraud charges against him to the state's highest criminal court, in one last bid to dismiss the case before it goes to trial.