Paxton’s wife defends bill empowering him
AUSTIN — State Sen. Angela Paxton has filed a bill that would expand the authority of her husband, Texas Attorney General Ken Paxton, and perhaps soften the securities law he has been charged with violating.
But Angela Paxton, R-McKinney, says that influencing her husband’s trial was not a factor in proposing the legislation.
“That has literally nothing to do with why I filed the bill,” she said when asked whether her proposal would have shielded her husband, had it been law when he was charged. “That may be hard for you to believe, but that has nothing to do with the purpose of the bill. People in my district brought this bill to me.”
She said she did not talk about the bill with Ken Paxton before filing it Friday: “No, he was not involved in that.”
Senate Bill 860 would create a “regulatory sandbox” allowing entrepreneurs to market test some financial products and services without a license. The attorney general’s office would regulate the sandbox program.
If passed, the legislation would exempt participating entrepreneurs from a portion of the state securities law, which is the basis for one of three pending felony charges against Ken Paxton, also a Republican. He is accused of selling securities without a license in a 2015 grand jury indictment, and faces two other charges of securities fraud. Angela Paxton’s bill does not propose to change the law retroactively.
However, a legal expert consulted by Hearst Newspapers suggested Ken Paxton’s criminal defense strategy could change should the bill become law. His lawyers could try to convince a jury it would be a waste of taxpayer money to convict him for an action that is no longer illegal, said Dwight McDonald, a Texas Tech law professor who practiced in criminal courts in Lubbock.
“I don’t know if a jury would buy that, but it’s certainly something to argue about,” McDonald said.
Political science professor Mark Jones said the optics of the bill are bad for both the Paxtons, and he doubts it will go very far.
“It hurts the Republican brand and any Republican that supports it,” said Jones. “I can’t imagine anyone outside the Paxton household who would think this would be a good idea or that it would ever pass.”
Angela Paxton said one of her constituents, Richardson Chamber of Commerce CEO Bill Sproull, asked her to carry the bill. As a leader of Tech Titans, a technology association in North Texas, Sproull said he and others in the group produced research on the idea of a regulatory sandbox to help the financial tech industry.
“I want policies to help our members innovate quicker,” Sproull said, adding he wants tech entrepreneurs to flock to Texas.
A similar measure has been approved by state lawmakers in Arizona.
Paxton’s bill would give the attorney general’s office more power, which is not uncommon for a state Legislature to do, said Paul Nolette, a Marquette University professor who studies state attorneys general.
But he called the Paxton bill a potential conflict of interest.
“I’m very surprised that she took the lead on this legislation because it’s pretty clear that it doesn’t look good,” Nolette said. “If you took the names away, took “Paxton” away from both of them, this would be pretty unremarkable. There really wouldn’t be much to say.”
Ken Paxton said Tuesday he had not yet read the bill, and referred questions about it to his wife. He said his office does not typically review legislation before lawmakers take it up in committee. The criminal indictment alleges that he convinced friends to invest in a North Dallas tech startup without disclosing he would collect a commission. He also failed to register with the state securities board and later paid a fine, records show.
A federal civil court dismissed similar charges against Paxton, although his trial in state criminal court has been postponed amid a legal fight over payment for the special prosecutors who are building the case against him. He has maintained his innocence and says the indictment was initiated by his foes in the Republican Party.