Nate Paul Dodges Prison Time in Federal Plea Deal

The final chapter of an 18-month investigation of embattled real estate investor Nate Paul came to a soft close in a downtown courthouse Wednesday.

Paul was sentenced to four months of home confinement, five years of supervised release and a $1 million fine, the Austin Business Journal reported. It marks the close of a high-profile fraud case that unraveled what was once one of Austin’s most aggressive real estate empires.

The World Class Holdings founder was sentenced on April 16 by Senior U.S. District Judge David Alan Ezra following his January guilty plea to one count of making false statements to a lending institution.

Eleven other charges, including wire fraud and additional counts of bank fraud, were dropped as part of a plea deal. Paul will be confined to his home from 7 p.m. to 7 a.m., but is permitted to continue working at his office during the day.

Federal prosecutors charged Paul in June 2023 with falsifying information to secure $172 million in loans. A superseding indictment added allegations of wire fraud involving private investors.

The charges carried decades of potential prison time, but prosecutors recommended no more than six months of incarceration under the deal.

Paul’s legal troubles stretch back to a 2019 FBI raid on his office, which spiraled into a web of lawsuits, whistleblower claims and an FBI investigation into Texas Attorney General Ken Paxton, an associate of Paul’s.

Paxton was accused by former staffers of using his office to benefit Paul, resulting in a $3.3 million whistleblower settlement. However, Paxton was cleared of impeachment charges related to the case.

Beyond the criminal case, Paul has faced millions in court judgments. A Travis County judge last year ruled in favor of United Heritage Credit Union, awarding $12.9 million in a loan default case. Paul also served a 10-day jail sentence in November for contempt of court tied to a fraud case involving the Mitte Foundation.

Since the 2019 raid, Paul’s empire has shed at least $322 million worth of real estate, including dozens of properties across Austin. Two World Class entities are in bankruptcy, and Paul is still listed among Travis County’s top delinquent taxpayers.

Despite it all, Paul has indicated he intends to keep working in real estate.

— Judah Duke