Justice Dept. in DC taking over Texas AG corruption probe

DALLAS (AP) — Justice Department officials in Washington have taken over the corruption investigation into Texas Attorney General Ken Paxton, removing the case from the hands of the federal prosecutors in Texas who’d long been leading the probe.

The move was disclosed in a statement by state prosecutors handling their own case against Paxton. It’s the latest development in the federal investigation into the attorney general, who came under FBI scrutiny in 2020 after his own top deputies accused him of bribery and abusing his office to help one of his campaign contributors, who also employed a woman with whom Paxton acknowledged having had an extramarital affair.

The investigation of the three-term Republican is now being led by the Justice Department’s Public Integrity Section, which prosecutes allegations of official misconduct against elected leaders at the local, state and federal level. The U.S. attorney’s office in Texas was recently recused from the complex case after working on it for years — an abrupt change that came within days of Paxton agreeing to apologize and pay $3.3 million in taxpayer money to four of the former staffers who reported him to the FBI.

State prosecutors working on a separate securities fraud case against Paxton — Brian Wice and Kent Schaffer — said in a statement to The Associated Press on Thursday that they were notified of the move. They referred all questions to the Justice Department, which declined to comment.

It’s not known whether Paxton will face charges, although federal investigators in Texas who had worked the case believed there was sufficient evidence for an indictment, according to two people familiar with the matter who spoke to the AP on condition of anonymity because they were not authorized to discuss the ongoing probe.

It was not immediately clear what prompted top Justice Department officials to recuse the federal prosecutors in West Texas but the move was pushed for by Paxton’s attorneys. One of his defense lawyers, Dan Cogdell, said Thursday that he’d previously appealed to agency officials to take the case out of the hands of the local U.S. attorney’s office, which he said had “an obvious conflict” because of the overlapping allegations and investigations that led to the probe of Paxton.

Eight of Paxton’s senior staff accused him of crimes in 2020 after the attorney general hired an outside lawyer to look into an Austin real-estate developer’s claims of wrongdoing by FBI agents and federal prosecutors who were separately investigating the developer. Those agents and lawyers are part of the same federal prosecutorial district as the ones who came to investigate Paxton.

“It was the right thing to do,” said Cogdell. He said federal officials had not informed him of the move and declined to comment further.

The overlap was known to officials within the Justice Department and publicly reported on by the AP within weeks of Paxton’s staff going to the FBI. Nonetheless, the agency left the investigation to be led by a career federal prosecutor based in San Antonio, who was previously best known for winning a money laundering and fraud case against a Democratic state senator.

Edward Loya Jr., a former prosecutor in the Public Integrity Section who now works as a defense lawyer, said in a text message to the AP that it was customary for the unit “to take over a high-profile investigation concerning a state-wide elected official because those cases often involve actual or potential conflicts that make it impossible for a local U.S. Attorney’s Office to handle such investigations.”

He said it was “totally normal” for the Washington-based section to assume responsibility of a local case like the Paxton one.

The federal investigation of Paxton expanded in the years since his former staff told the FBI he was committing crimes to help the developer, Nate Paul. It came to look at renovations made to Paxton’s million-dollar home, but was also drawn out as leadership of the U.S. attorney’s office for West Texas has repeatedly changed.

Paxton and Paul have broadly denied wrongdoing.

Over those years, Paxton has seen little political cost from the the federal investigation and the separate 2015 securities fraud indictment for which he has yet to face trial. He easily defeated challenger George P. Bush in a contested GOP primary last spring, went on to decisively beat his Democratic opponent and secure a third term in November and has filed a steady stream of legal challenges to the administration of Democratic President Joe Biden. The Public Integrity Section has brought a series of high-profile prosecutions in the last decades. One of its former chiefs, Jack Smith, is now serving as the Justice Department special counsel overseeing investigations of former President Donald Trump’s retention of classified documents as well as efforts by Trump and his allies to undo the results of the 2020 election.

Although the unit has secured major convictions, it has also endured notable setbacks.

The section was involved in prosecuting former Virginia Gov. Bob McDonnell, a Republican, but the Supreme Court later overturned his bribery conviction. The section also prosecuted former Democratic vice presidential nominee John Edwards, but a jury acquitted him on one count and deadlocked on others. The Justice Department declined to try him again. A jury also deadlocked in the case of New Jersey Sen. Bob Menendez, prompting a judge to declare a mistrial.

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Tucker reported from Washington.