AUSTIN, Texas (AP) — A Texas businessman at the center of a scandal that led to a historic indictment State Attorney General Ken Paxton was charged Friday with making false statements to mortgage lenders to obtain $172 million in loans.
The federal indictment of real estate developer Nate Ball was the result of a years-long FBI investigation — an investigation that included Paxton’s office and set off a chain of events that eventually led to his firing and suspension. From office last month.
Paul was charged with eight counts of making false statements when obtaining loans from mortgage lenders in the United States and Ireland. No mention was made of Paxton or the Attorney General’s Office during the hearing.
Ball, 36, who entered the federal courtroom wearing jeans, a blue shirt and Nikes, did not enter a plea during his first appearance in an Austin court or respond publicly when the charges were read. He was released ahead of trial but ordered to surrender his passport and notify the court of any travel outside Texas.
Paul “is adamant that he is not guilty,” defense attorney Jerry Morris said after questioning, adding that he did not know when his client had last spoken to Paxton. Paxton’s attorney did not immediately respond to a request for comment Friday.
Paul is accused of overstating his assets and understating his debts, including providing false and falsified records to financial institutions while applying for loans in 2017 and 2018. In one case, prosecutors said Paul told banks he had $18 million in an account when he had less than $13,000. In another case outlined in the 23-page indictment, Paul is accused of having $28 million in loans, but paying the credit union a much lower figure in 2018.
In 2019, FBI agents investigating Paul’s complex real estate empire raided his Austin offices and palatial home.. The next year, Paxton’s eight Top representatives of the Attorney General filed a complaint with the FBI over allegations of bribery and abuse of office, including the hiring of an outside attorney. To investigate claims of developer wrongdoing by federal agents.
The allegations by Paxton’s staff sparked an FBI investigation that is ongoing and was central to 20 articles of impeachment overwhelmingly approved by the GOP-led state House of Representatives.. These include abuse of public trust, ineligibility for office and bribery.
Paxton was accused of using his office to aid Paul in unproven claims of an elaborate conspiracy to steal $200 million in developer assets. In return, the developer hired a woman with whom Paxton had an extramarital affair, according to bribery accounts. And paid for expensive renovations To the Attorney General’s Million Dollar Austin Home.
Paxton’s attorneys this week sought to refute the latter claim by releasing a bank statement that allegedly involved a 2020 wire transfer showing Paxton, but not a donor, paid more than $120,000 to renovate a home. But the document raised new questions About the actions of men.
The wire exchange was dated October 1, 2020 — the same day Paxton’s representatives signed a letter informing the head of human resources at the Texas Attorney General’s office that they had reported their employer to the FBI. The $121,000 payment was made to Cupertino Builders, whose manager worked for Paul and had an email address with his company, state corporation and court records.
Paul faced numerous lawsuits from creditors and business partners over the years, and many of his companies filed for bankruptcy or were placed under the supervision of court-appointed receivers. Last year, one of those receivers wrote in a statement that Cupertino Builders was used for “fraudulent transfers” from Paul’s business.
Paul Paxton has denied paying bribes. The attorney general has also broadly denied wrongdoing and said he expects to be exonerated during an impeachment trial in the state Senate, where his wife is a member.
Because Paxton is only the third officer in Texas history to be impeached, the Senate will set its own rules for a hearing with little precedent. The action will start after August 28.
Paxton was indicted separately on securities fraud charges in 2015, though he has yet to stand trial.
Bleiberg reported from Dallas.