The 39-count indictment – filed earlier this month in the Northern District of California and printed this week – sometimes reads as a scenario: The charges against Brockman include managing a complex network of foreign companies and bank accounts; use of undeclared taxable income to purchase a luxury yacht called “Turmoil;”
“Amounts in dollars aside, I have not seen this pattern of greed or cover-up and cover-up in my 25 years as a special agent,” said Jim Lee, head of the IRS’s criminal investigation unit, during a news conference.
“We look forward to defending him against these allegations,” Catherine Kennelly, Brockman’s lawyer, told CNN Business. Kennelly is a former Assistant Attorney General for the U.S. Department of Justice, Tax Department.
A spokesman for Reynolds & Reynolds said the allegations in the indictment focused on activities that Brockman had engaged in “outside of his professional responsibilities with Reynolds & Reynolds,” according to a statement provided to CNN Business. “It is not claimed that the company has committed any violations and we are confident in the integrity and strength of our business.”
The prosecution also alleges that Brockman took steps, such as asking employees to date the archives back and using encrypted communications to cover up the alleged scheme. Brockman is also said to have fraudulently bought nearly $ 68 million of his software company’s debt securities while maintaining inside information about the company.
If convicted, Brockman faces a “significant period of imprisonment,” authorities said, as well as restitution and confiscation.
Smith of Vista Equity Partners has claimed responsibility for its role in the alleged tax evasion scheme and agreed to a non-prosecution agreement, officials said. Vista Equity Partners declined to comment.
Officials say the 57-year-old Smith hid money in offshore accounts in Belize and Nevis. Smith used his tax-free income to buy a vacation home in Sonoma, ski properties in the French Alps and make charitable donations, including maintaining a home in Colorado for children from the city and injured veterans, authorities said. As part of an agreement with the Justice Department, Smith will pay $ 139 million in taxes and sanctions, drop his $ 182 million refund claim and pay interest, but avoid prosecution.
“It’s never too late to tell the truth. Smith has committed serious crimes, but he has also agreed to cooperate,” said attorney David Anderson. “Smith’s agreement to cooperate put him on the road away from the indictment.”