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Robert Brockman, a billionaire in Texas and the CEO of automotive software company Reynolds & Reynolds Co., is facing criminal charges including tax evasion, wire fraud, money laundering, other offenses.

According to the U.S. Department of Justice, a federal grand jury in San Francisco indicted Brockman on 39 counts of criminal charges for violating federal laws.

The largest tax-evasion case in U.S. history

The Texas billionaire was indicted with seven counts of tax evasion for hiding around $2 billion of capital gains for two decades. It is the largest-ever tax evasion case in the history of the United States.

In the indictment, Brockman allegedly created offshore entities and then used them to conceal his income from investments in private equity funds managed by a San Francisco-based investment firm.

Brockman allegedly transferred untaxed capital gains income to secret bank accounts in Bermuda and Switzerland between 1999 and 2019. He allegedly executed the scheme by backdating records and through a co-conspirator. As part of the tax evasion conspiracy, Brockman alleged used code words in encrypted e-mails when communicating with his co-conspirator.

From 2008 to 2010, Brockman committed fraud to obtain approximately $67.8 million in Reynolds & Reynolds debt securities. Under his contract as CEO, he cannot purchase any of the company’s debt securities without advance notice full disclose, and amending the associated credit agreements. Brockman sidestepped those requirements using a third party, according to the indictment.

The indictment further alleged that the Texas billionaire purchased debt securities using the material, non-public information about the software company.

Moreover, Brockman allegedly another individual to alter, destroy, and mutilate documents and computer evidence to prevent a grand jury investigation.

The DOJ and IRS are committed to prosecuting tax crimes

In a statement, DOJ Tax Division Principal Deputy Assistant Attorney General Richard Zuckerman said, “Today’s indictment reflects the Department of Justice’s commitment to finding and prosecuting the costliest and most sophisticated tax crimes in the United States.”

On the other hand, Jim Lee, Chief of IRS Criminal Investigation said, “As alleged, Mr. Brockman is responsible for carrying out an approximately two billion dollar tax evasion scheme.” He added that the agency is “aggressively” prosecuting tax evaders in the United States and overseas. “No scheme is too complex or sophisticated for our investigators. Those hiding income or assets offshore are encouraged to come forward and voluntarily disclose their holdings,” said Lee.

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