Texas Attorney General Ken Paxton is suing the East Plano Islamic Center over allegations the mosque violated state securities laws in its proposed project, according to a lawsuit filed Friday.<\/p>\n
Paxton accused EPIC, its corporate entity Community Capital Partners and its leaders of engaging in fraudulent practices while soliciting funds and says the groups failed to legally verify its statuses as “accredited investors.” <\/p>\n
The suit comes after Paxton claimed in November <\/a>his office found evidence EPIC violated state and federal laws. In a letter to the Texas Securities Board, he claimed he received more than 750 documents and written responses from Community Capital as part of an investigation he opened into EPIC in March<\/a>. <\/p>\n \u201cThe leaders behind EPIC City have engaged in a radical plot to destroy hundreds of acres of beautiful Texas land and line their own pockets,\u201d Paxton said in a press release. \u201cI will relentlessly bring the full force of the law against anyone who thinks they can ignore the rules and hurt Texans. The unlawful land project known as EPIC City will be stopped, and those responsible will be barred from ever creating another fraudulent operation like this again.\u201d<\/p>\n KERA News reached out to EPIC and Community Capital and will update this story with any response.<\/p>\n The proposed development formerly known as EPIC City, which was renamed to The Meadow last month<\/a>, is a 402-acre development in unincorporated Collin and Hunt counties, roughly 40 miles northeast of Dallas near the city of Josephine. It would include a new mosque, more than 1,000 single and multi-family homes, a K-12 faith-based school, senior housing, an outreach center, commercial developments, sports facilities, and a community college. It was first proposed in November 2024.<\/p>\n It’s faced backlash from state officials and people online throughout this year. Paxton launched the first probe into the development, followed by three more state investigations\u00a0<\/a>and a criminal investigation by the U.S. Department of Justice over religious discrimination accusations.<\/p>\n Among several things, the suit claims the mosque and Community Capital Partners \u201cdevised a scheme\u201d to publicly sell shared to investors interested in purchasing plots of land. It also says Community Capital Partners \u201cfell significantly short\u201d when verifying which of its investors were accredited as part of state laws from TSSB.<\/p>\n The suit also claims Community Capital Partners violated solicitation laws when Paxton\u2019s office found undisclosed promotional videos about The Meadow online. And, it says the groups misled investors when it promoted The Meadow would be in the Josephine but instead would be in unincorporated land between Collin and Hunt counties.<\/p>\n His suit is seeking a temporary restraining order and permanent injunction against the project.<\/p>\n Paxton in recent years faced his own allegations of securities fraud and other illegal activities that led to his impeachment in 2023 but not removal from office.<\/p>\n In 2015, Paxton was indicted by a Collin County grand jury<\/a> on three felonies \u2014 two charges of first-degree securities fraud and a third-degree charge that he failed to register as a securities agent.<\/p>\n At the time, he was accused of encouraging people<\/a> to invest more than $600,000 in technology company Servergy Inc. without disclosing he was making a commission and misrepresenting himself as an investor.\u00a0He was also charged with failing to register with state securities regulators for soliciting clients for investment firm Mowery Capital Management in return for fees.\u00a0<\/p>\n The U.S. Securities and Exchange Commission in 2016 charged Servergy<\/a> with fraud on claims the company misled investors when it told them the company\u2019s product was energy efficient to boost stock sales.<\/p>\n In 2024, the federal case ended<\/a>\u00a0in a deal with prosecutors dropping the charges so long as Paxton paid nearly $300,000 in restitution.<\/p>\n The U.S. Securities and Exchange Commission also sued Paxton but that case was dismissed by a federal judge<\/a> in 2017.<\/p>\n Paxton was also acquitted<\/a> on corruption charges during his impeachment trial in the Texas Senate in 2023.<\/p>\n Penelope Rivera is KERA’s breaking news reporter. Got a tip? Email Penelope Rivera at\u00a0privera@kera.org<\/a>.<\/p>\n