Denver-born Billionaire Robert Smith reaches $139 million tax settlement with federal prosecutors

Robert F. Smith, the Denver native whose tech investing made him a multi-billionaire, is set to avoid prosecution for tax evasion after reaching a $139 million settlement with the government, officials announced Thursday.

Smith, an alumnus of Denver’s East High School, has been under federal investigation since 2016 for dodging taxes on $200 million in assets moved through financial entities based in the Caribbean, according to a Bloomberg News story published in August.

That criminal probe is coming to an end after Smith reached a deal with the Department of Justice, the Associated Press reported. In addition to the settlement, Smith is working with prosecutors in a case against Houston businessman Robert Brockman.

Brockman was indicted Thursday on 39 charges related to an alleged $2 billion tax fraud scheme, according to the AP, the largest-ever tax evasion case against an American.

Brockman, a part-time resident of Pitkin County, gave Smith $1 billion in 2000 to help launch his highly successful tech investment firm, Vista Equity Partners.

On Thursday, David L. Anderson, U.S. attorney for the Northern District of California, commended Smith for working with prosecutors.

“Smith’s agreement to cooperate has put him on a path away from indictment,” the AP quoted Anderson as saying.

Smith, 57, started his professional life as a chemical engineer before going into finance. He’s now worth more than $5 billion, making him the richest Black person in America and the 330th richest person in the world, according to Forbes 2020 listing of billionaires.

Smith is well known for his philanthropy. His pledge to pay off all the student loan debt for 400 students graduating from Morehouse College made international news in the spring of 2019.

Smith and Vista are based in Austin, Texas but are deeply invested in tech companies and other ventures in Denver.

He used $13 million of the untaxed money at the heart of the investigation to buy a property in Colorado and fund charitable events there, according to the AP.

When Denver Startup Week 2020 was held virtually last month, Smith was the keynote speaker, participating in a video question and answer session with Denver Mayor Michael Hancock. During that event, Smith talked about the “tens of millions of dollars” he has invested in the Welton Street corridor, the portion of Denver once known as the Harlem of the West for its importance to Black culture.

“Why?” Smith said of his investments in Denver’s most storied Black community. “Because you have to invest into that talent pool there to get more STEM-educated people from all walks of life in America actually now participating in what in the next generation of opportunity which is going to be STEM-oriented or tech-oriented.”

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