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Robert Smith, Billionaire Who Promised to Pay Off Morehouse Student Loans, Committed Tax Fraud

Remember last year when billionaire Robert Smith told students graduating from Morehouse College he was going to pay their student loans? Remember how good that felt to see? Well, you might want to hold on to that feeling because it turns out dude committed tax fraud.

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According to the Hill, Smith admitted to participating in a scheme that used offshore bank accounts and trusts to avoid paying taxes for the last 15 years. Smith entered a non-prosecution agreement with the Department of Justice where he agreed to cooperate with an investigation into the scheme. He has agreed to pay $139 million in taxes and penalties and forfeit $182 million in charitable donations.

“It is never too late to do the right thing,” U.S. Attorney David Anderson said in a statement. “It is never too late to tell the truth. Smith committed serious crimes, but he also agreed to cooperate. Smith’s agreement to cooperate has put him on a path away from indictment.”

From the Hill:

Smith, the CEO of Vista Equity Partners, admitted to using third parties to conceal his beneficial ownership and control of the Excelsior Trust in Belize and Flash Holdings, a shell company. He formed these entities so that he could use them to avoid paying taxes.

Smith also admitted to using the Excelsior Trust and Flash Holdings and their foreign accounts in the British Virgin Islands and Switzerland to hide income earned and distributed to Flash Holdings from private equity funds.

The billionaire, who lives in Austin, Texas, did not report over $200 million of partnership income as a result of the scheme.

The story originally posted at The Root

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