Billionaire Robert Smith reaches $140 million tax settlement with DOJ
Billionaire Robert Smith reached a $140 million settlement with the DOJ in a four-year criminal tax investigation.
Smith, who pledged to pay off student debt at Morehouse College last year, must also admit wrongdoing related to tax crimes and assets held in offshore tax structures.
the GRIO previously reported, Smith allegedly failed to pay taxes on approximately $200 million in assets that passed through offshore accounts linked to Robert Brockman, a software businessman from Houston.
Brockman reportedly gave Smith $1 billion in 2000 to start his investment company, with funds from a Bermuda-based charitable trust.
Read more: Did Robert F. Smith use black America?
Smith has reportedly been on the IRS radar since 2014, Bloomberg reported. That year, the billionaire reportedly approached the federal agency to seek amnesty from prosecution under a program for Americans who failed to report offshore assets. The IRS, however, denied Smith’s request. The agency would have refused taxpayers if it already knew they had not reported offshore accounts.
In September 2019, Smith’s Vista Equity Partners faced a lawsuit accusing it of personal dealings, according to New York Post. Kurt Lauk, a former executive at Audi, claimed he was kicked off the board of automotive software company Solera Holdings when he raised the issue. The lawsuit accused Vista of using Solera as a “personal piggy bank” to bail out the company’s failed investments in other companies. The lawsuit also accused Vista of misleading its investors, which Smith and the company denied.
Smith cooperated with the Justice Department and Internal Revenue Service criminal tax investigation to avoid prosecution. A conviction would have forced him to leave his management company Vista Equity Partners, a $65 million fine and a prison sentence.
As part of the settlement, he must admit that he failed to pay approximately $30 million in taxes, with penalties and interest representing the expected payment of $140 million, per Bloomberg.
Smith’s tax problems began after he allegedly failed to file proper reports on foreign bank and financial accounts, the report said.
The businessman and entrepreneur is the richest black person in America, with a reported net worth of $7 billion.
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