DALLAS — An investment advisor who worked with incoming Texas attorney general Ken Paxton could lose his securities license after an administrative hearing Jan. 27.
Frederick Eugene Mowery, manager of Mowery Capital Management in McKinney, Texas, was given 20 days to respond to State Securities Board
Mowery is accused of failing to disclose that his company had a fee arrangement with a broker that charged transaction fees that were twice the market rate.
Mowery's lawyer, Kevin Edmundson, denied the allegations and said he will contest them at a Jan. 27 state administrative law judge hearing, according to the Dallas Morning News.
"The suggestion that the brokerage firm [used by Mowery Capital] charged twice the fees to Mowery's customers, and that Mowery shared in those fees, is baseless," Edmundson told the News.
About a month before his Nov. 4 election as attorney general, Paxton was reprimanded by the State Securities Board and fined $1,000 for his role in directing business to Mowery's firm. Paxton admitted to serving as a financial advisor without registering with the state.
Paxton hasn't commented on the case. Campaign officials accused "liberals" of attempting to exploit the case for political ends.
Paxton, who will become the state's top lawyer in January, received 30% of management fees from Mowery for directing clients to the firm, according to documents in the case.
