Billionaire Rats On Houston Attorney Carlos Kepke’s $225m Offshore Tax Planning Rip-off To Avoid Jail – Laws In Texas

Tax Attorney Facing Prison For Allegedly Helping Billionaires Robert Smith And Bob Brockman Dodge The IRSAPR sixteen, 2021

It’s a brand new prison improvement for personal equity billionaire Robert F. Smith and his onetime mentor Bob Brockman, already accused of the biggest tax evasion in U.S. records.

Yesterday, the U.S. Department of Justice introduced the indictment of Carlos E. Kepke, a Houston tax lawyer who prosecutors say conspired with Smith to cover $225 million in untaxed capital profits from the IRS between 1999 and 2014 — all through the years whilst Smith changed into rapidly developing Vista Equity Partners.

Prosecutors say that Smith paid Kepke $1 million on the grounds that 2007 for his offerings, which included making ready Smith’s fake 2012-2014 tax returns and putting in offshore entities to useful resource in tax evasion.

Prosecutors allege Kepke created for Smith a confined legal responsibility enterprise in Nevis known as Flash Holdings, as well as an offshore accept as true with based in Belize, referred to as Excelsior Trust. Excelsior become set up to own Flash. Thus, when Smith’s portion of capital profits from Vista funds changed into deposited into bills held in Flash’s name in Switzerland and the British Virgin Islands, the cash might be routed to the offshore Excelsior trust, far from the eyes of the IRS.

According to the DOJ’s press release, Kepke enabled what Smith has admitted to as an unlawful scheme. Thanks to Kepke’s work, “Smith changed into able to hide this earnings because Excelsior, and no longer Smith, turned into the nominal owner of Flash. Smith then allegedly did not timely and absolutely report his profits to the IRS.”

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An respectable indictment isn’t but available from U.S. District Court for the Northern District of California, in San Francisco. Kepke is scheduled to be arraigned April 22. According to the assertion, he faces five years in prison on one conspiracy remember and 3 years on each of three counts of getting ready fake tax returns. There turned into no answer on the range listed for Kepke’s Houston law workplace. A University of Texas law school graduate, he seems to had been admitted to the Texas bar in 1964.

This indictment appears to be the subsequent step within the DOJ’s unraveling of a decade’s long financial fraud in opposition to U.S. taxpayers perpetrated no longer simply with the aid of Robert Smith however additionally, allegedly, by way of his mentor and economic backer Bob Brockman. Brockman in 2000 agreed to place up $1 billion to fund the startup of Smith’s private equity institution, which now has $seventy three billion under control.

Last October Smith entered into a “non-prosecution settlement” with the DOJ, in which he admitted to prison tax evasion and the wrongful use of roughly $30 million in charitable consider funds for his private benefit. Smith agreed to fork over $139 million in taxes and consequences, and to cooperate in opposition to affiliated scofflaws like Brockman, and Kepke. U.S. Attorney David L. Anderson stated at the time that regardless of having dedicated “extreme crimes,” Smith’s cooperation had “positioned him on a route away from indictment.”

Prosecutors may want to likewise be planning on leveraging Kepke for testimony against every other of his clients, Bob Brockman, who has himself been indicted via the DOJ for evading taxes on some $2 billion in gains from Vista Equity Partners investments.

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According to a December 2020 motion by means of Brockman’s attorneys to move his case from San Francisco to Houston, Smith has already presupposed to the DOJ that Kepke turned into on the center of their conspiracy. “Mr. Smith, in turn, has alleged that Carlos Kepke, a attorney in practice in Houston, Texas, had a crucial position in establishing the trusts and supporting Mr. Brockman with asset making plans.”

Kepke’s call also seems in a mystery 2017 memo written to Brockman by using his money guy and previous trustee Evatt Tamine (submitted as proof), in which Tamine writes approximately meeting with Smith, his lawyer and Carlos Kepke to be able to assist cowl their tracks: “I worked thru their files and recognized areas of problem.”

In that identical memo, Tamine describes journeying to peer the widow of a currently deceased Brockman confidant from whom he gathered and destroyed “drives, disks or documents” with incriminating financial records.

With Smith and Tamine already cooperating against Brockman, this new indictment can be aimed at getting Kepke to talk as nicely.

Meanwhile in Bermuda, oversight of the multi-billion-dollar A. Eugene Brockman Charitable Trust, remains in limbo, as legal professionals for Brockman and his wife Dorothy argued currently to the Bermuda appelate court docket that they need to employ a brand new impartial trustee to supervise the accept as true with, replacing every body linked to former trustee Tamine. According to legal professionals, Cayman Island-based totally trust specialist Maples Group has agreed to take on the process.

Entities owned with the aid of the Brockman believe control Reynolds and Reynolds, the provider of software program solutions to automobile dealerships which Brockman ran till his retirement remaining 12 months. According to court files, he and his attorneys at the moment are targeted on convincing prosecutors and courtroom-appointed psychiatrists that he is affected by dementia too a long way advanced to permit him to stand trial.

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Billionaire Rats on Houston Attorney Carlos Kepke’s $225M Offshore Tax Planning Scam to Avoid Jail

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