According to the indictment, Brockman - Robert Brockman, Chief Executive Officer of Ohio-based software company Reynolds and Reynolds - used a web of offshore entities based in Bermuda and Nevis to hide from the IRS income earned on his investments in private equity funds which were managed by a San Francisco-based investment firm.
Furthermore, Smith admits that he "knowingly and intentionally" used the Excelsior Trust and Flash Holdings and their associated foreign bank accounts to hide from the IRS and the U.S. Treasury Department income earned and distributed to Flash Holdings from private equity funds.
Mr Anderson said Smith, who helped secure the charges against Brockman and famously announced at last year's Morehouse College commencement that he would pay off the college debt of 2019 graduates, accepted responsibility for his own crimes in the tax evasion scheme.
In a news conference, Anderson, the US attorney in San Francisco, said that Smith signed a non-prosecution agreement, where he admitted to his part in the scheme and agreed to cooperate with investigators.
Brockman was so paranoid that the Internal Revenue Service would catch on to his scheme, prosecutors said, that in June 2016 the Texas billionaire allegedly ordered his offshore money handler to travel the USA destroying paper evidence and "electronic media" with shredders and hammers.
He faces seven counts of tax evasion, six counts of failing to file reports disclosing foreign bank accounts, and numerous other counts including wire fraud, money laundering and evidence tampering.
Appearing via teleconference at a federal court in Houston, Brockman pleaded not guilty to the charges.
"We look forward to defending him against these charges", said Brockman attorney Kathryn Keneally.
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As the CEO of Reynolds & Reynolds, Brockman oversees one of the largest vendors of software to manage auto dealerships in the USA and overseas.
Forbes lists Smith as No. 461 on its billionaires list, with a net worth of more than $5 billion.
The settlement includes back taxes, penalties and interest, ending a four-year investigation involving offshore tax havens.
"These allegations should disgust every American taxpayer as well because the law applies to all of us when it comes to tax and paying our fair share".
The Chicago-based ticket resale operation touts itself as an independent operator, but counts both Vista and GTCR as private equity firms backing it. The elaborate scheme was uncovered in part by fellow billionaire Robert F. Smith, who agreed to cooperate with the federal government to bring down Brockman. Network used. He allegedly had secret bank accounts in Bermuda and Switzerland, where he used his profits to sell his assets. The historically Black institution in Atlanta said the donation amounted to $34 million.
No Vista Equity Partners entity is part of the settlement. Had it been true that the offshore assets had always been designated for charity, it could have supported the view that Smith didn't owe taxes on them. He has agreed to cooperate with ongoing federal investigations, to forfeit tax breaks on $182 million in charitable contributions, and to pay nearly $140 million in fines.
Prosecutors say that Smith used about $2.5 million in untaxed funds to buy and upgrade a vacation home in Sonoma, California; purchase two ski properties in France; and spend $13 million to buy a property and fund charitable activities at his property in Colorado.
-Laura Saunders contributed to this article.