AUSTIN — The real estate developer linked to claims of corruption against Ken Paxton hired a woman who allegedly had an extramarital affair with the attorney general, The Dallas Morning News has learned.

Nate Paul, an Austin-based businessman and campaign donor, said he believed Paxton recommended the woman for a job at his firm, according to a deposition The News obtained Wednesday. Paul acknowledged knowing Paxton for several years, and he said they spoke as recently as last week, when Paul expressed condolences over the death of Paxton’s mother.

The deposition — taken Monday in a financial dispute between Paul and an Austin-based charity — sheds new light on the depth of the men’s ties.

Their relationship is under scrutiny after seven top staffers in the attorney general’s office reported Paxton to law enforcement and accused him of serious crimes — bribery, abuse of office and improper influence. They said that Paul has repeatedly tried to use the state agency for personal gain, and that Paxton let him.

Paxton accused the employees of impeding a criminal investigation and fired three of them. He called their allegations false and said he wouldn’t step down. Paxton said he was doing his job to defend the constitutional rights of Texas citizens.

“My own staff attacked me publicly,” he told the online Southeast Texas Record last month in his only interview about the accusations. “All I ever asked them to do was find the truth.”

Hours after the deposition began, First Assistant Attorney General Brent Webster ordered Paul to stop answering certain questions, according to Paul’s attorney. Paul then declined to speak about his communications with Paxton.

Spokesmen for the agency and Paxton’s campaign did not respond to requests for comment.

Paul’s attorney, Michael Wynne, did not answer questions about when the woman was hired or why Paxton might have recommended her. He told The News that Paul’s company has hundreds of employees, including the woman, and “in accordance with state and federal laws does not invade their privacy, including to inquire about their personal lives.”

The News is not identifying the woman because she is not a public figure. She could not be reached Thursday for comment.

The deposition

It’s not clear when Paul hired the woman, but records show she had worked as a legislative staffer until the end of 2019.

In the deposition, Paul confirmed that she is a project manager in charge of several redevelopment projects and handles “whatever needs to be done in the business.” He said he met her when she inquired about a position with his firm. Paul said he could not remember if Paxton recommended the woman before she inquired about the job. He said he couldn’t recall ever engaging socially with Paxton and the woman.

Paul said in the deposition that he didn’t know the extent of Paxton’s alleged relationship with the woman. He denied employing her as a favor to Paxton.

Paxton had a romantic relationship with the woman, according to two people who said the attorney general had told them about the affair. These individuals requested anonymity because of the sensitivity and personal nature of the information.

One of the employees who accused Paxton of serious crimes was concerned that the extramarital affair affected the attorney general’s decision-making because the woman was working with Paul, the individual told The News.

Paxton, a Republican, has built a reputation as a staunch conservative Christian. He is married to state Sen. Angela Paxton, R-McKinney, who was elected in 2018. A spokesman for the senator did not respond to a request for comment Thursday about the alleged affair.

Paxton has been under indictment since 2015, just months after he was elected attorney general, for allegedly duping investors in a North Texas technology company. He faces three felony charges. Paxton denies all the allegations. He was reelected in 2018.

Paul’s company, World Class, owns real estate in Austin, Dallas and Houston, as well as out of state. He is a well-known figure in the Austin business community, and his company’s real estate entities are currently caught up in more than a dozen bankruptcy cases, according to the Austin-American Statesman. In 2019, the FBI raided his home and business.

The FBI has not said whether an investigation is underway; no charges have been brought. Paul says the FBI violated his rights and carried out the raids improperly.

Paxton and Paul

The depth of Paxton and Paul’s relationship is unclear; neither has answered The News' questions about when or how they met. Paul donated $25,000 to Paxton’s reelection campaign in 2018, and Paxton has acknowledged knowing the developer.

In the deposition, Paul was asked repeatedly about his relationship with Paxton. He denied that Paxton owns interests in any of his business projects.

Paul said the two men met several years ago, and when asked if they were friends, he demurred, saying, “I consider the relationship, you know, positive.”

This year, Paxton has personally intervened at least four times on a range of legal matters before his agency that involved or helped Paul. The intervention that kicked off the mutiny among his top staffers occurred when Paxton brought in an outside lawyer over their objections to probe Paul’s accusations of wrongdoing by the FBI.

Paul also alleged that several people, including lawyers and a federal bankruptcy judge, were scheming to seize millions of dollars of his real estate equity.

Some of these individuals are linked to litigation between Paul’s entities and the Roy F. and Joann Mitte Foundation, the Austin nonprofit whose attorney deposed Paul this week. Like Paul’s allegations against the FBI, this second criminal complaint was referred to Paxton’s agency for investigation and was handled by the same outside lawyer, Brandon Cammack of Houston.

Neither Paxton’s spokesman nor Paul’s attorney responded to questions about whether the woman described in the deposition as a project manager was involved in any legal matters the developer had pending before the Office of the Attorney General this year.

Paxton has defended his recent actions, pointing the finger back at the employees who accused him of crimes. Since the accusations became public in early October, three of the employees have been fired, three resigned and one is on leave.

Paul acknowledged in the deposition that he had talked with Paxton and his staff about his legal matters, including his lawsuit with the Mitte Foundation. But he denied coercing Paxton to hire an outside lawyer to investigate his complaints.

Several hours into the deposition, Paul was asked whether he had ever talked with Paxton about Cammack, the outside lawyer, before Paxton retained him. That’s when Wynne, Paul’s attorney, asked to take a break.

When the questioning resumed, Wynne said that he had just spoken with First Assistant Attorney General Brent Webster. Wynne said Webster directed his client not to talk about his complaints about the FBI and the alleged scheme to seize his properties.

“The attorney general’s office is asserting law enforcement privilege on all of these matters and all of these questions,” Wynne said. “They were not notified about this deposition, so on their behalf I’m conveying that message and instructing my witness not to answer. Regardless of who turns out is right, I would rather my client not disobey a direct order from the first assistant here.”

Paul declined to answer several more questions from an attorney for the court-appointed receiver in the legal dispute, including whether the developer had recordings of Paxton or had met with Cammack.

The Office of the Attorney General did not respond to requests for comment about Webster’s apparent order for Paul to stop answering questions.