The indictments were handed up on Tuesday and will be unsealed Monday. Paxton faces three felony charges: two counts of first-degree securities fraud and a third-degree charge of failing to register with the state securities board, The New York Times reported.
Paxton's office did not immediately return a request for comment.
Paxton is accused of misleading and encouraging investors to put over $600,000 in a technology company without disclosing that he received a fee on their investment and while serving in the Texas House of Representatives, The New York Times reported.
Paxton also had a similar arrangement with a financial management firm that was accused of “unethical and fraudulent conduct,” The Dallas Morning News reported in May. Last year, Paxton admitted to the Texas State Securities Board that he improperly did not register as an investment adviser when referring clients, and paid a $1,000 fine.
But failing to register with the board can also be prosecuted as a criminal charge. After Paxton paid the fine, a watchdog group then filed a complaint asking that Paxton face criminal charges, which eventually led to an investigation by the Texas Rangers. A special prosecutor appointed in the case told WFAA in May that the investigation had led to new evidence.
Paxton can surrender and get booked at any of the state's county jails, according to WFAA. He does not have to leave office while facing trial.