Following disclosure last week that Austin billionaire Robert F. Smith had reached a $140 million tax evasion settlement, more information has emerged from federal authorities and other sources.
Smith is Chairman and CEO of Vista Equity Partners, a $58 billion private equity firm with 400 direct employees and thousands more working in its portfolio companies. Perched on top of Austin's Frost Bank Tower, Vista's Austin office was founded in 2011 and is one of five offices throughout the U.S.
Smith, 57, lives in Austin's Westlake area, overlooking Lake Austin. The son of two Colorado school teachers, his net worth is estimated by Forbes to be more than $5 billion. He is regarded as the country's wealthiest Black person.
Smith is cooperating with federal investigators in exchange for non-prosecution
Smith is assisting federal authorities in their investigation of Houston resident Robert Brockman, 79. Charged with hiding $2 billion in income over 20 years in the nation's largest-ever personal tax fraud case, the feds say Brockman filed false tax returns and concealed overseas cash.
Brockman was the original investor who funded Smith's creation of Vista.
At a Thursday press conference, at which Smith's behavior was called "egregious," the U.S. Attorney for the Northern District of California David Anderson announced Brockman's indictment and Smith's cooperation agreement. Anderson said that Smith will be responsible for the following:
- Providing complete and truthful information
- Continuing work with federal prosecutors
- Attending meetings and providing documents
- Testifying before a grand jury
Money in offshore accounts was used for Smith's extravagant personal real estate
A copy of Smith's signed Oct. 7 settlement letter with the government reveals that Smith routed untaxed gains through offshore partnerships and bank accounts in Belize, Nevis, the British Virgin Islands, the Cayman Islands and Switzerland.
Smith admitted to concealing more than $200 million in income and evading subsequent taxes during a 15-year period, from 2000 to 2015.
While much of the money was routed to Smith's charitable trust, the settlement letter states that substantial funds were withdrawn for personal use in real estate acquisitions and remodeling projects, including:
- A home in Sonoma County, California that he owned with his then-wife
- A Colorado ranch property that he used personally and at which he hosted events for disadvantaged youth and wounded war veterans
- Two ski chalets in the French Alps used by Smith and his family
- A European industrial property
Smith's settlement is larger than originally stated
According to documents signed by Smith, he has agreed to:
- Pay $139 million in taxes and penalties
- Abandon a $182 million tax refund claim
- Pay interest on taxes owed
Cloudy reports at Vista
Axios reports that Smith held a call with top Vista executives last week, in which he discussed his tax settlement and disclosed that his longtime billionaire associate, Vista co-founder and president Brian N. Sheth, would be leaving the company. Axios referred to a "breakdown in the two men's relationship."
Vista's situation is unclear as investors are alarmed and the SEC, according to Axios, is poised to investigate whether Smith will be allowed to continue to run the firm.
Authorities deny that Smith's connections were a factor
U.S. Attorney Anderson specifically denied, in response to a direct question, that Smith's charitable involvements and political connections were a factor in the decision not to prosecute him.
Smith famously repaid student loans last year for all graduates of Atlanta's Morehouse College. His list of philanthropic efforts is extensive, and in 2019 he was awarded the Carnegie Medal of Philanthropy.
During the investigation period, Smith had cultivated relationships with people close to President Donald Trump, including Treasury Secretary Steven Mnuchin and the president's daughter, Ivanka, according to various reports.
- Robert F. Smith agrees to $140M tax fraud settlement - austonia ›
- Robert F. Smith reportedly under investigation for potential tax crimes ›
- Radiant plumbing hits the campaign trail in new commercial - austonia ›
- Forbes' 2021 30 Under 30 list features 6 enterprising Austinites - austonia ›
- Austin man charged in $1.7B 'Ponzi-like' scheme - austonia ›
As Austin's "icepocalypse" melts into the rearview mirror, though day-to-day life has mostly resumed, the city has a long, arduous recovery process ahead. It seems as though no area was immune to the damage inflicted by the historic winter storm.
- It's snowing! Here's what that looks like in Austin - austonia ›
- Photos: Winter storm brings power outages, snow to Austin - austonia ›
- Snow day: power outages, icy roads and school closures - austonia ›
Austin restaurateurs say supporting Black-owned businesses shouldn't be a 'fad' but a year-round effort
After the devastating blow of the pandemic, Emojis Grilled Cheese Bar owner Hope Green saw a surge in sales last summer. The outpouring of community support for Black-owned businesses came in the wake of the killing of George Floyd and nationwide protests against police brutality and racial injustice. But for Emojis the support has been fleeting.
- Restaurant industry on the brink in Austin and nationally - austonia ›
- Austin restaurants and businesses struggle due to COVID-19 ... ›
- Austin black-owned restaurants see support after protests - austonia ›
Scheduled showers, porta potties and hotel stays: Hundreds of Austin apartment complexes still don't have water
The last night Stephanie Landgraf, 25, spent in her apartment, off of Rundberg Lane, was on Valentine's Day. First, her power went off, only to return shortly after the complex lost water. Since then, she's been staying with friends. "There's no end in sight," she told Austonia. "At this point, I'm just angry."
- As reservoirs begin to refill, two zones regain water supply - austonia ›
- Austin faces 'multi-day' water crisis after winter weather - austonia ›
- Water distribution plan continues as Austin Water works to restore ... ›