Democrat challenging Ken Paxton targets loophole used by Paxton to fund legal defense

In his bid to unseat Texas Attorney General Ken Paxton, Democrat Justin Nelson vowed Thursday to close loopholes that have allowed Paxton to take in hundreds of thousands of dollars for his personal legal defense in recent years.

Financial disclosure statements show that Paxton has reported receiving more than $600,000 in gifts over the last three years to cover his legal defense in connection with his 2015 indictment for securities fraud. Paxton has described the donors as either family friends or others who are not covered by state bribery laws.

State bribery laws prohibit elected officials from accepting gifts from parties subject to their authority. But Paxton has justified the contributions to his legal defense by claiming an exemption that allows him to receive gifts from people who are “independent” of his “official status.”

While unveiling his plan “to clean up Texas government” at a news conference outside Paxton's office in Austin Thursday, Nelson said he would remove that exemption if elected.

Nelson, an Austin lawyer, also said he would ban anyone in the Office of the Attorney General from accepting personal gifts from any registered lobbyist, attorney or other party working with the office and put an end to the “food, lodging, transportation or entertainment” loophole, which allows government officials to receive some non-cash gifts.

Asked about Nelson's proposal, Paxton campaign spokesman Jordan Berry said in a statement, “Texans don't need ethics lessons from a liberal trial lawyer who got wealthy suing businesses and extorting financial settlements from job creators.”

Along with stricter policies around accepting gifts, Nelson also called for “full financial transparency” in the Office of the Attorney General and a five-year ban on statewide officials registering as lobbyists after leaving office. Texas currently has no law detailing how long elected officials have to wait before becoming a lobbyist. Efforts to slow the revolving door between the Legislature and the special-interest lobby crumbled at the end of last year’s legislative session.

Nelson said he would first implement his anti-corruption plan at the Office of the Attorney General and later work with the Legislature to apply the requirements across Texas government.

“It is important for us to help restore confidence in our state government,” Nelson said, adding that Texans “don’t want a crook in office.”

Paxton was indicted by a Collin County grand jury in 2015 on two first-degree felony charges of securities fraud and a third-degree felony charge of failure to register. He has pleaded not guilty and been cleared in a related federal case but has not yet gone to trial on the state charges.

Nelson has made Paxton's legal issues a centerpiece of his campaign to unseat him. A Democrat has not won statewide office in Texas in over 20 years. Earlier this week, Nelson's campaign reported raising $1.1 million between July 1 and Sept. 27. Paxton reported raising $488,000 over the same period but maintained a significant cash-on-hand advantage to Nelson.