WASHINGTON – The Securities and Exchange Commission is suing the attorney general of Texas, Ken Paxton, for not disclosing the compensation he's received for promoting a stock. Paxton allegedly raised $840,000 in funds for Servergy Inc. and received 100,000 shares in return while in the Texas House of Representatives without disclosing his commissions. A former Servergy director, Caleb White, settled with the SEC on similar charges. The SEC also announced fraud charges against Servergy Inc. and its founder, William E. Mapp III, for saying in private offerings that its servers could compete with IBM, Dell and Hewlett-Packard without disclosing that the products could not in reality compete. Servery agreed to pay a $200,000 fine while the case against Mapp, who the company cut ties with, continues. Servergy and White neither admitted nor denied the SEC's charges in their settlements.
Continue Reading Below
Copyright © 2016 MarketWatch, Inc.