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Austin Developer At Center Of Texas AG Impeachment Arrested, Charged With Multiple Felony Financial Crimes

An Austin developer accused of having an inappropriate relationship with disgraced Texas Attorney General Ken Paxton has been arrested by the FBI.

World Class Capital CEO Nate Paul was booked into an Austin jail Thursday and is being held on eight counts of felony financial crimes.

Nate Paul

Members of the GOP-led Texas House of Representatives voted overwhelmingly May 28 to impeach Paxton for what they claim is a years-long pattern of impropriety, including misspent funds and misuse of his office to benefit Paul, a friend of Paxton’s and a political donor.

Details about what led to Paul’s arrest have so far been scant, but it comes after bank transfer records show Paxton paid $121K to Cupertino Builders, a company allegedly linked to Paul. The move — made by Paxton’s own legal team — was intended to undercut allegations that Paul helped pay for renovations to the AG’s home, but in hindsight may have done more harm than good.

Cupertino Builders was formed in October 2020 and dissolved after less than two years, Texas corporation records show. A report written last year by a court-appointed overseer assigned to some of Paul’s properties found that the company was used for fraudulent transfers to a friend named Narsimha Raju Sagiraju, convicted of fraud in California in 2016.

In an unrelated deposition, Sagiraju said he did consulting work for Paul and even maintained a company email address, per KIRO 7.

Paxton’s attorney, Tony Buzbee, stopped short of addressing the link between Paul and Cupertino Builders, but in an email to KIRO 7 said the receipts "clearly demonstrate" Paxton paid for the repairs.

“We have the receipts,” Buzbee told reporters Wednesday. “This is the type of evidence we tried to offer them once we found out this foolishness was going on.”

Paul rose to prominence about a decade ago for having a 9M SF property portfolio across downtown Austin, much of which he acquired on the cheap during the Great Financial Crisis. He was also known for his success in raising institutional capital and for his self-storage business, Great Value Storage, which he sold last year for $588M.

He has been under investigation by the FBI since at least 2015, when top deputies in Paxton’s office first alleged unseemly dealings between the two men. That led to a raid of Paul’s home and office in 2019, though no charges were made.

Paxton is temporarily suspended from office pending the outcome of a trial in the Texas Senate that is set to begin by late August. The jury will include Paxton’s wife, state Sen. Angela Paxton, who has not yet said whether she will recuse herself.