Texas Billionaire Brockman’s Estate Pays $750 Million to Settle Historic Tax Case

Robert Brockman’s estate has agreed to a $750 million settlement to resolve a long-running tax dispute, according to a Tuesday filing in the U.S. Tax Court, reported the Wall Street Journal.

The case stems from what authorities called the largest tax-fraud investigation ever filed against an individual.

The Internal Revenue Service initially sought $1.4 billion, including interest, though $993 million represented only back taxes and penalties. The amount of interest the estate might still owe has not been disclosed.

Federal prosecutors alleged Brockman, a Texas entrepreneur in automotive software, hid more than $2 billion through a network of offshore entities. He reportedly used encrypted servers and fishing-themed code names to communicate with those managing his offshore holdings. Much of the concealed income came from his early investments in private-equity firm Vista Equity Partners, which he helped start. Vista CEO Robert Smith had previously settled a related tax-evasion case.

Brockman, who denied the charges, passed away in 2022 at 81 while awaiting trial. A Houston tax attorney tied to both Brockman and Smith died by suicide before facing criminal proceedings.

The settlement resolves civil claims for tax years 2004 through 2018, with Brockman’s estate paying $456 million in back taxes and $294 million in penalties.

Colleagues remembered Brockman for his extreme frugality, often staying in budget hotels and eating frozen meals while traveling for business. He also distrusted the IRS, describing it as “a corrupt organization that unfairly targeted taxpayers,” according to The Wall Street Journal.