US Brings 'Largest Ever Tax Charge' Against Tech Executive

“The allegation of a $2 billion tax fraud is the largest ever tax charge against an individual in the United States,” David L. Anderson, the U.S. attorney in San Francisco, said at a news conference.

James Lee, chief of criminal investigations at the IRS, said the charges “disgusted me.”

“These allegations should disgust every American taxpayer, as well, because the law applies to all of us when it comes to tax and paying our fair share,” he said.

Kathryn Keneally, a lawyer for Brockman, said, “We look forward to defending him against these charges.”

A spokeswoman for Reynolds and Reynolds said the charges “focus on activities Robert Brockman engaged in outside of his professional responsibilities” with the company. Reynolds and Reynolds “is not alleged to have engaged in any wrongdoing, and we are confident in the integrity and strength of our business,” the spokeswoman said.

Federal prosecutors said Brockman’s goal was to conceal from the IRS capital gains income that he had earned as a result of his investments in funds managed by Vista Equity Partners, whose billionaire chief executive, Robert F. Smith, has agreed to cooperate with federal authorities.

Smith, who has been called the richest Black man in America, drew national attention last year when he was giving the commencement address at Morehouse College in Atlanta and made a surprise announcement that he would pay off the student loans of the roughly 400 graduates.

Federal prosecutors said Smith had signed an agreement acknowledging his involvement in a 15-year scheme to hide more than $200 million in income and evade millions in taxes by using an offshore trust structure and offshore bank accounts.

Under the agreement, the Department of Justice said it would not prosecute Smith if he paid more than $139 million in taxes and penalties, abandoned $182 million in charitable deduction claims and cooperated with ongoing investigations.

Mark E. Matthews, a lawyer for Smith, declined to comment Thursday.

Anderson said the agreement showed that “it is never too late to do the right thing.”

“Although Smith willfully and knowingly violated the law, Smith has accepted responsibility and agreed to provide complete and truthful cooperation,” he said.

Federal prosecutors said that Smith used his unreported income to buy and make improvements to real estate used for his personal benefit.

They said he had used income hidden from taxation to buy and renovate a $2.5 million vacation home in Sonoma, California; to buy two ski properties and a piece of commercial property in France; and to build and make improvements to a home in Colorado that was used charitably for disadvantaged children and wounded veterans.