The FBI on Thursday arrested a businessman at the center of the scandal that led to Texas Atty. The historic impeachment of General Ken Paxton, amid new questions about their dealings raised by financial records released by Paxton’s lawyers to try to exonerate him from bribery charges.

Austin real estate developer Nate Paul, 36, was taken into custody by federal agents and booked into an Austin jail in the afternoon, according to Travis County Sheriffs Office records. It wasn’t immediately clear what charges led to his arrest, but the records showed he was being held at a federal prison for a felony.

Paul’s arrest followed a years-long federal investigation into his handling of an investigation involving Paxton, a Republican, in his office, sparking a chain of events that ultimately led to his impeachment last month.

Lawyers for Paul did not immediately respond to requests for comment. One of Paxton’s attorneys, Dan Cogdell, said he had no additional information about the arrest. The FBI declined to comment and a spokesperson for West Texas federal prosecutors did not respond to questions.

FBI agents investigating Paul’s troubled real estate empire searched his Austin offices and his palatial home in 2019. The following year, eight of Paxton’s top deputies reported the Attorney General to the FBI on charges of bribery and abuse of his office to aid Paul. Among the 20 articles of impeachment are allegations that Paxton used his office’s power to aid Paul in unsubstantiated claims of an elaborate conspiracy to steal $200 million from the developer’s property.

The allegations by Paxton staff prompted an FBI investigation, which is still ongoing, and is at the center of impeachment articles overwhelmingly approved by the GOP-led Texas House of Representatives.

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On Wednesday, Paxton’s defense team showed a packed room of journalists a bank statement with a wire transfer from 2020 showing that he, not a donor, paid more than $120,000 for a home renovation.

The transfer was dated 10 Oct. On January 1, 2020 the same day, Paxton’s deputies signed a letter informing the Chief of Human Resources at the Texas Attorney General’s Office that they had reported Paxton to the FBI.

The $121,000 payment was to Cupertino Builders, whose manager was an employee of Paul’s, state company and court records show.

The company was incorporated as a Texas corporation only more than three weeks after the transaction. In April of that year, a company of the same name was formed in Delaware, although public filings there do not clarify who is behind it.

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Last year, a court-appointed overseer for some of Paul’s businesses wrote in a report that Cupertino Builders was used for fraudulent transfers of his company to Narsimha Raju Sagiraju, who was convicted of fraud in California in 2016. The report described Sagiraju as Paul’s boyfriend.

Paul, who also employed a woman with whom Paxton admitted to having an extramarital affair, has denied bribing Paxton. In a statement, Paul described Sagiraju as an independent contractor and said he does not remember how they first met.

The timing of the payment and the identity of who was paid for renovations at Paxton’s Austin home was not publicly known before his new legal team held a press conference Wednesday in which they placed financial documents on a projection screen as they criticized the impeachment. They were first reported by the Wall Street Journal.

Tony Buzbee, a prominent Houston lawyer who was hired by Paxton over the weekend and led the press conference, said by email Thursday that the receipts clearly show that Paxton paid for the repairs themselves. He did not address questions about the timing of the payments or about Cupertino Builders.

Without any evidence, the politicians who led this mock impeachment were falsely accused [Attorney] General Paxton for not paying for the repairs to his house. That’s a lie, Buzbee said.

Since becoming just the third incumbent in Texas history to be impeached, Paxton has attacked the proceedings as politically motivated and rushed, saying he never got a chance to refute the allegations in the House.

We’ve got the receipts, Buzbee told reporters Wednesday as the documents flashed on screen. This is the kind of proof we tried to provide them when we found out this folly was going on.

Paxton has been temporarily suspended pending the outcome of a Texas Senate trial that will begin no later than August 28. The jury will consist of the members of the 31-seat Senate; one of them, Paxton’s wife, Senator Angela Paxton, has not said whether she will withdraw.

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The Paxtons bought their home in Austin in 2018. When it was remodeled two years later, former Paxton staff claimed in court documents, Paul was involved in the work.

The city has no records of building permits as of the time of the renovations. Another Austin contractor, not Cupertino Builders, received a federal grand jury subpoena in 2021 for files related to work on the Paxton home that began in January 2020.

Cupertino Builders was founded in October 2020 and dissolved less than two years later, according to the Texas company’s records. His manager was Sagiraju, who said in a statement in an unrelated case that he did consulting work for Paul’s company and had an email address with Paul’s company.

Sagiraju acknowledged serving time for securities fraud and grand larceny in California before moving to Austin, according to a transcript of the statement. He said he was first introduced to Paul by a mutual friend before he was in prison and they later did a few projects together.

Paxton was named separately in 2015 for securities fraud allegations, though he has yet to face trial.