Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

The Billionaire Behind the Biggest U.S. Tax Fraud Case Ever Filed

The Billionaire Behind the Biggest U.S. Tax Fraud Case Ever Filed

More than 20 years ago, a group of former salesmen for Houston software entrepreneur Robert Brockman sued their old boss, claiming in court that he had deprived them of commissions by directing a portion of customer payments to a Cayman Islands entity.
Mr. Brockman twice appealed to the Texas Supreme Court as he tried to avoid answering detailed questions about the offshore entity, and he settled the case in 2001 under confidential terms.

Although the salesmen didn’t realize it at the time, they had stumbled onto early signs of what the government later called the largest criminal case ever brought against a person accused of evading U.S. taxes. Federal prosecutors in October charged Mr. Brockman with using a web of offshore entities to conceal about $2 billion in income from the Internal Revenue Service.

Mr. Brockman has pleaded not guilty to 39 criminal counts, including tax evasion, wire fraud, money laundering and evidence destruction. He and his attorneys didn’t respond to requests for comment.

Prosecutors allege the bulk of the tax evasion stemmed from profits Mr. Brockman made from investments with Vista Equity Partners, a private-equity firm he helped launch in 2000 and which now manages $73 billion in funds dedicated to software investments.

Vista founder Robert Smith, the wealthiest Black person in America, settled his own tax-evasion case with the government, which was made public on the day of Mr. Brockman’s indictment. Mr. Smith has agreed to testify against his former mentor, one of at least two Brockman confidants to turn on him.

Some of the money in the criminal case against Mr. Brockman originated with the same Cayman Islands entity that the salesmen complained about years earlier, according to an IRS affidavit unsealed in December. The link between the two cases hasn’t been previously reported.

The record-setting case pits Mr. Brockman, a billionaire with a reputation as a relentless litigant, against the immense resources of the federal government. Legal specialists say the government appears to have strong evidence, but federal prosecutors may face challenges trying the case because of the complexity of tax laws governing offshore trusts.

In another potential hurdle for the government, the 79-year-old Mr. Brockman claims in court documents he can’t be tried because he is suffering from dementia and is unable to assist in his own defense. Prosecutors said in court filings that he could be faking a mental decline. A hearing on his competency is scheduled for June, and if the court sides with Mr. Brockman, the charges could be dropped or deferred.

Despite his wealth, Mr. Brockman was virtually unknown outside of a small circle in Houston and the automotive industry until his indictment was announced in the fall.

Court documents and interviews with his former employees, business associates and his younger brother portray him as a brilliant, sometimes penny-pinching executive with an antigovernment streak that led him to regard the IRS as a corrupt organization unfairly targeting taxpayers.

Mr. Brockman bought used furniture for company offices, rarely gave raises and forbade employees from smoking to save money on health insurance, according to former employees and associates. He stayed at budget hotels and ate frozen dinners in his room during monthly visits to one of his company’s offices near Dayton, Ohio, a former vice president at his software firm recalled.

Most of the wealth he gathered over the years is held in a Bermuda trust that owns, among other things, nearly all of his software company. The firm, Reynolds & Reynolds Co., provides software to auto dealerships, and it had annual revenue of about $1.4 billion, according to a now-defunct Brockman charity website. Mr. Brockman was chief executive of Reynolds & Reynolds until the indictment.

“The allegations made by the Department of Justice focus on activities Robert Brockman engaged in outside of his professional responsibilities with Reynolds & Reynolds,” a company spokeswoman said in a statement. “Throughout numerous court filings and legal proceedings, the Company has never been alleged to have engaged in any wrongdoing in any way.”

The Bermuda trust has assets of at least $7.7 billion, including $1.4 billion in Swiss bank accounts, according to a confidential affidavit from Mr. Brockman’s wife that was filed with a Bermuda court and reviewed by The Wall Street Journal. A lawyer for a former trustee suggested in a recent Bermuda court hearing the trust’s total value could be as high as $10 billion.

That level of wealth would rank Mr. Brockman around 50th on the most recent Forbes 400 list of U.S. billionaires, well ahead of Twitter Inc. CEO Jack Dorsey and Fidelity Investments magnate Edward Johnson III. Mr. Brockman never appears on the list.

Among the assets Mr. Brockman has amassed: a Bombardier private jet, a 209-foot yacht, a 17,000-square-foot residence in Houston and a 5,800-square-foot cabin in Aspen, Colo., according to public records and court documents filed by prosecutors.
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
Western Europe Records Hottest June on Record
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
China’s Central Bank Consults European Peers on Low-Rate Strategies
France Requests Airlines to Cut Flights at Paris Airports Amid Planned Air Traffic Controller Strike
Poland Implements Border Checks Amid Growing Migration Tensions
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
China Unveils Miniature Insect-Like Surveillance Drone
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Massive Anti-Government Protests Erupt in Belgrade
Iran Executes Alleged Israeli Spies and Arrests Hundreds Amid Post-War Crackdown
Hungary's Prime Minister Criticizes NATO's Role in Ukraine
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Hungarian Scientist to Conduct 30 Research Experiments on the International Space Station
NATO Members Agree to 5% Defense Spending Target by 2035
NATO Leaders Endorse Plan for Increased Defence Spending
U.S. Crude Oil Prices Drop Below $65 Amid Market Volatility
International Astronaut Team Launched to Space Station
Macron and Merz: Europe must arm itself in an unstable world
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Iran Intensifies Crackdown on Alleged Mossad Operatives After Sabotage Claims
Trump Praises Iran’s ‘Very Weak’ Response After U.S. Strikes and Presses Israel to Pursue Peace
Oil Prices Set to Surge After US Strikes Iran
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
Labubu Doll Drives Pop Mart to Status as China’s Most Valuable Toy Maker
Global Coal Demand Defies Paris Accord Goals
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
Telegram Founder: I Will Leave My Fortune to Over 100 of My Children
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
×