FBI arrests Texas businessman linked to impeachment of state Attorney General Ken Paxton
AUSTIN, Texas — FBI agents on Thursday arrested a businessman at the center of the scandal that led to the historic impeachment of Texas Attorney General Ken Paxton, a day after his defense presented evidence that was intended to counter bribery allegations but raised new questions about the two men’s dealings.
Nate Paul was booked into an Austin jail in the afternoon after being taken into custody by federal agents, according Travis County Sheriff’s Office records. It was not immediately clear what charges led to his arrest, and the records said only that he was being held on a federal detainer for a felony.
Lawyers for Paul and the U.S. Attorney’s Office in West Texas did not immediately respond to requests for comment. The FBI declined to comment, and a lawyer for Paxton, Dan Cogdell, said he had no additional information about Paul’s arrest.
Paul’s entanglements with Paxton were central to the GOPled state House of Representatives’ overwhelming vote to impeach the Republican last month.
Paul’s troubled real estate empire has been the focus of federal scrutiny for years, and agents searched his Austin offices and palatial home in 2019.
The next year, Paxton involved his office in the federal case, a move that prompted his top staff to report him to the FBI.
Their allegations of bribery and abuse of office by Paxton prompted separate FBI investigation of the attorney general, which remains ongoing.
On Wednesday, Paxton’s defense team showed a packed room of journalists a bank statement that included a 2020 wire transfer purportedly showing him, and not one a donor, paying more than $120,000 for a home renovation.
The wire transfer was dated Oct. 1, 2020 — the same day seven of Paxton’s top deputies signed a letter informing the head of human resources at the Texas attorney general’s office that they had reported Paxton to the FBI over accusations of bribery, abuse of office and improper influence.
The $121,000 payment was to Cupertino Builders, whose manager was an associate of Paul, state corporation and court records show.
The company did not incorporate as a business in Texas until more than three weeks after the transaction took place. A company of the same name was formed in Delaware in April of that year, although public filings there do not make clear who is behind it.
Last year a court- appointed overseer for some of Paul’s companies wrote in a report that Cupertino Builders was used for “fraudulent transfers” from Paul’s business to Narsimha Raju Sagiraju, who was convicted of fraud in California in 2016. The report described Sagiraju as Paul’s “friend.”
Paul, who also employed a woman with whom Paxton acknowledged having an extramarital affair, has denied bribing Paxton. In a deposition, Paul described Sagiraju as an “independent contractor” and said he didn’t remember how they first met.
The timing of the payment — and the identity of who was paid for renovations at Paxton’s home in Austin — was not publicly known before his new legal team held a news conference in which they put financial documents on a projector screen while calling the impeachment a sham. They were first reported by The Wall Street Journal.
Tony Buzbee, a prominent Houston attorney who was hired by Paxton over the weekend and led the news conference, said by email Thursday that receipts “clearly demonstrate” Paxton paid for the repairs. He did not address questions about the timing of the payments or Cupertino Builders.
“Without any evidence the politicians leading this sham impeachment falsely accused General Paxton of not paying for the repairs to his home. That is a lie,” Buzbee said.
Since becoming just the third sitting official in Texas history to be impeached, Paxton has attacked the proceedings as politically motivated and rushed, saying he was never given the chance to rebut the accusations in the Texas House of Representatives.
“We have the receipts,” Buzbee told reporters Wednesday as the documents flashed onscreen. “This is the type of evidence we tried to offer them once we found out this foolishness was going on.”