Kaufman County District Attorney Erleigh Wiley, a fellow Republican, said late Friday that she considered a section of the Texas Penal Code that bans gifts to public servants by a person under his or her jurisdiction, and an exception that allows gifts “on account of kinship or a personal, professional or business relationship independent” of the receiver’s office.
“After a thorough review of the evidence gathered during this investigation, my office concluded that Attorney General Paxton had a personal relationship with the donor, in addition to a prior attorney/client relationship, which relationships render Penal Code Section 36.08 inapplicable to this donation,” Wiley said in a statement. “Accordingly, this investigation has been closed.”
Paxton accepted the gift for his legal defense fund in 2015 from James Webb, the head of Preferred Imaging LLC. Federal prosecutors said in July 2016 that the Dallas-based company would pay $3.5 million to resolve a whistleblower’s False Claims Act and Texas Medicaid Fraud Prevention Act claims that it engaged in improper billing.
Preferred Imaging admitted no wrongdoing in the settlement. The U.S. Department of Justice acknowledged at the time the Texas Attorney General’s Civil Medicaid Fraud Division for helping in the investigation.
Paxton at the time denied any violation of the gift rules and denied that his office investigated the company, saying he “never received a referral.”
Paxton spokesman Matt Welch called the exoneration “the latest in a long line of baseless taxpayer-funded investigations” of his boss.
“We are pleased, but not surprised, that Attorney General Paxton was once again cleared of false allegations,” Welch said in a statement Friday evening.
Paxton is awaiting trial in Harris County on two first-degree felony counts of securities fraud and a third-degree felony count of failing to register with a state securities regulator, dating back to his time in the Texas House of Representatives in 2011. He faces up to 99 years in state prison if convicted.