Robert F. Smith asks judge to seal evidence in tax fraud case

Robert F. Smith, America’s richest African-American, has quietly made a flurry of court motions to seal the evidence in an epic tax evasion case where he is an associate witness – and insiders are scratching their heads.

The head of Vista Equity Partners — whose net worth is estimated by Forbes at $6.7 billion, and who recently made headlines with a failed bid to buy the Denver Broncos — escaped criminal charges over alleged tax evasion in October 2020. brokerage of a non-prosecution deal To testify against former Reynolds and Reynolds CEO Robert Brockman.

Brockman, an early investment advisor to Smith and the lead seed investor of Vista’s large tech buyout fund, was charged with more than $2 billion in alleged fraud in 2020 — the largest tax-evasion case in US history.

Smith, 59, who is also the chairman of Carnegie Hall and who famously spent $34 million to pay off Morehouse College’s entire graduating class student loans of 2019 – brokered his immunity deal with the Fed in 2020. Of. At that time, he also agreed to pay taxes and fines in full as part of the deal. But those terms only extend to the offenses Smith admitted under the deal, sources told The Post.

Robert Smith was recently in the news for his unsuccessful bid to buy the Denver Broncos.
Bloomberg via Getty Images

In latest round of legal filings Created in the US Southern District of Texas on July 11, it is unclear what Smith wants that remains out of the public eye, and legal experts caution that it may be as simple as keeping Vista’s finances private, or your own. Nevertheless, experts also note that such requests are not made daily in federal tax matters.

“It’s very unusual … I certainly haven’t seen anything like it while working on these cases.” Victor Song, who served as head of the IRS criminal investigation — and now runs forensic accounting company Integritas 3 — told The Post.

Smith’s representatives declined to comment.

In addition to the case against Brockman, in which Smith has agreed to testify, there are two active lawsuits that are potential sources of sensitive information about Smith. In the first, Smith is defending the government, but that case has yet to move forward.

The second — an IRS lawsuit against Houston-based attorney Carlos Kepke, who prosecutors say worked closely with both Smith and Brockman on tax evasion — could reveal new communications between Smith and his then-lawyer Kepke about tax evasion. Huh. As recently as 2015, Smith paid KEPK $1 million to help with taxes, according to a suit reviewed by The Post.

in March, The Wall Street Journal reported An IRS court filing revealed that Smith’s role in Brockman’s alleged fraud was greater than previously known—specifically, that he helped Brockman move US$635 million to offshore accounts. The Smiths both transferred money on Brockman’s behalf to one of their own offshore accounts, and signed the deal.

Robert Brockman
Robert Brockman was charged with over $2 billion in alleged fraud.
Bloomberg via Getty Images

At the time, Smith’s lawyer said he relied on representations from other parties involved as well as a law firm’s opinion that the transaction was not taxable, and noted that the government had not alleged that he I was involved in wrongdoing. transactions.

Earlier this month, Bloomberg told Court docs indicate that Smith set up a Belize trust using a false affidavit allegedly signed by the uncle of his first wife, Susan McFadden-Smith—details that were part of the lawsuit against Kepke. emerged as

Meanwhile, Smith’s personal lawyer, Emily Hughes, has requested not only to sit in court proceedings against Brockman, but two attorneys who negotiated a plea deal with the government on Smith’s behalf.

A person close to the situation told On The Money, “He wants his team to be on the field in case he gets hit by a fan.”

In recent months, Smith has struggled to raise cash for a new technology fund in Vista — with some insiders noting that pension funds have rules for investing with individuals involved in tax fraud.

As previously reported by The Post, Oregon Public Employees Retirement System, which invested $500 million with Smith in 2019, is now investing just $250 million in Vista’s new flagship fund, filings show .

Leave a Comment

%d bloggers like this: