Very wealthy Democrat Robert Smith is ordered to pay a staggering $140 million in a settlement to a four-year tax investigation.
Caught Holding Off Shore Assets
Bloomberg reported Wednesday that the billionaire got caught holding assets in an offshore tax haven.
The Justice Department and the IRS held an investigation into taxes unpaid on $200 million in assets.
Smith is the chief executive officer of the private equity firm Vista Equity Partners.
The 57-year-old accepted a deal that requires him to cooperate with the tax investigations and he also has to admit to misconduct. However, with the deal, he will not be prosecuted.
Investigation Ends with $140 Settlement
In the hefty settlement, his firm Vista is not involved and it could be made public Thursday. The $140 million includes back taxes, interest and penalties.
Smith garnished attention after he promised a year ago to pay the student debt off for an entire class of college graduates.
With a net worth of $7 billion, Smith is considered the wealthiest black person in the United States.
20 years ago, Vista encountered a problem involving taxes from a $1 billion investment into Vista’s first fund.
Details Emerge
Bloomberg reports:
On Thursday, the U.S. attorney in San Francisco, David Anderson, and the IRS chief of criminal investigation, Jim Lee, will hold a news conference about a “new significant law enforcement action,” according to an advisory. A spokesman for the U.S. attorney declined to comment on the substance of the news conference or the Smith agreement.
Prosecutors in the Brockman matter, who were investigating “a major and very large tax fraud” in the U.S., believe $1.5 billion of revenue was fraudulently concealed, according to Bermuda court records.
Smith’s settlement includes a non-prosecution agreement that says he failed to pay about $30 million in taxes, with penalties and interest making up the remainder of the expected payout, according to a person familiar with a call that Smith conducted Wednesday. Smith said on the call that over three years, he failed to file accurate reports of foreign bank and financial accounts, known as FBARs, the person said.
