The heirs of a deceased American technology billionaire have agreed to a monumental $750 million settlement with the Internal Revenue Service (IRS), closing a landmark civil fraud case. The estate of Robert Brockman finalised the deal this week, ending a protracted legal battle that began with his indictment in 2020.
The Largest Individual Tax Evasion Claim in US History
Robert Brockman, the former chief executive of Reynolds & Reynolds Co, was indicted in 2020 on a staggering 39 counts. Prosecutors accused him of orchestrating a complex scheme to conceal approximately $2 billion in income from the IRS over two decades. This allegation represented the largest tax evasion claim ever brought against a single individual in the United States.
US Attorney David Anderson emphasised the historic scale of the charges at a press conference in San Francisco, stating the case was unprecedented. The intricate plot allegedly involved a web of offshore entities in Bermuda and St. Kitts and Nevis, with nominees appointed to hide Brockman's involvement. He even utilised an encrypted communications system with code words like 'Permit' and 'Red fish' to direct untaxed capital gains to secret bank accounts in Bermuda and Switzerland.
A Lavish Lifestyle Funded by Hidden Billions
While Brockman's former associates described him as frugal in business—opting for budget hotels and used office furniture—prosecutors outlined a life of extreme luxury funded by the hidden income. His assets included an $8 million mansion in Houston, Texas, a ski cabin in Aspen, Colorado, a 209-foot yacht, and a Bombardier Global 6000 private jet valued at around $62 million. At the time of his death in August 2022, Forbes estimated his net worth at $4.7 billion.
The criminal case against Brockman was complicated by his health. His lawyers argued he was unfit for trial due to worsening dementia linked to Parkinson's disease, a condition they said was exacerbated by a COVID-19 infection. However, a judge ruled in May 2022 that he was competent to stand trial. Brockman passed away just weeks later, on 5 August 2022, while bedridden and in hospice care.
A $750 Million Resolution to a Years-Long Battle
Although Brockman's death ended the criminal proceedings, a separate civil case continued in tax court. The IRS had initially sought about $1.4 billion, including interest. The final settlement, signed by US Tax Court Judge Kathleen Kerrigan, requires Brockman's estate to pay $456 million in back taxes and $294 million in penalties, covering tax years from 2004 to 2018. The exact amount of applicable interest was not immediately disclosed.
Brockman is survived by his wife of 53 years, Dorothy, his son Robert II, his brother David, a daughter-in-law, and two grandchildren. The settlement brings a costly conclusion to one of the most significant tax fraud cases ever pursued, recovering hundreds of millions for the US Treasury.
