Central Figure in Texas AG Impeachment Indicted Over Loans From CU & MLBs
Prosecutors allege investor Nate Paul made false statements to obtain $11.9 million in loans from Amplify Credit Union.
Real estate developer Nate Paul, who is reportedly central to the allegations of illegal conduct by suspended Texas Attorney General Ken Paxton, has been charged with eight felony counts of making false statements to three mortgage lending businesses (MLBs) and the $1.4 billion Amplify Credit Union in Austin, Texas.
Amplify, however, sold the loans nearly three years ago and did not incur any losses.
Paul, 36, will be arraigned on June 26 in federal court on the charges that he allegedly made false statements and reports that overstated his assets and understated his liabilities to obtain more than $172 million in loans from Amplify and three MLBs in Ireland, Connecticut and New York, according to an indictment that was unsealed last Friday.
The indictment did not specifically name the MLBs and the credit union. However, the Texas Tribune reported last week it established that count seven of the indictment refers to a $2,730,000 loan that Amplify approved in May 2018 for WC Alamo Industrial Center owned by Paul. For that loan application, Paul allegedly made a false statement to the credit union that he had $3.3 million in liabilities, but he actually had $28.6 million in liabilities.
“Amplify has ties to the Paxton impeachment because it was among 39 businesses and individuals that received grand jury subpoenas to provide documents and information to Brandon Cammack, a Houston lawyer hired by the attorney general’s office — at Paxton’s insistence — to investigate on Paul’s behalf, according to a House committee examination that led to Paxton’s impeachment last month,” according to the Texas Tribune.
The GOP-led Texas House voted 121-23 to impeach Paxton based on accusations of bribery, obstruction of justice and abuse of public trust. The Texas Senate is expected to hold a trial in August on whether to remove Paxton from office.
Amplify President/CEO Kendall Garrison confirmed the information reported by the Texas Tribune is accurate when reached by CU Times.
“In addition, as can be found in recorded assignments with Travis County … we sold all three loans associated with World Class Capital in September 2020 at market value. In short, Amplify made these loans in accordance with industry practices, incurred no losses,” Garrison said.
The three loans amounted to $11,983,252.
Garrison also provided copies of the documents filed with Travis County that showed the loans were sold. World Class Capital is the real estate investment firm that is owned by Paul who acquired an “enviable portfolio of some of Austin’s choicest parcels with ambitious plans to lease or develop them,” the Texas Tribune reported in October 2020.
According to count one of the federal indictment, Paul applied for two Amplify loans for companies he owned in March 2017. The first loan was for $2,713,252 for WC 707 Cesar Chavez LLC and the second was for $6,540,000 for WC Custer Creek Center Property.
During Amplify’s due diligence process for these loans, a representative asked Paul for a consolidated list of outstanding items, including bank statements for largest cash balances. Paul allegedly emailed Amplify a bank account statement showing a balance of $31,681,316 in cash. However, prosecutors determined this was false and the bank account had a cash balance of only $500,000 and that the remainder of the account’s value consisted of securities.
Paul also allegedly made numerous false statements to obtain more than $160,000,000 from the three MLBs, according to the indictment.
In addition to seeking to convict Paul on the eight felony counts of making false statements, federal prosecutors are planning to seek $172 million in restitution.