(TheLibertyRevolution.com)- Houston tax lawyer Carlos Kepke had been teaching affluent Americans, like Robert F. Smith, how to shift assets abroad for decades until an undercover agent acting as a club owner showed up in 2018.
Kepke’s tax fraud case needed evidence. Easy. Kepke boasted to the wired agent about putting assets in offshore trusts, especially in Belize. Federal legislation requires clients to shift money and cede control. Foreign trustees don’t decide how it’s utilized.
“You never lose control,” Kepke assured his visitor. “You’re just playing with bank accounts.”
This guarantee is included in a fresh affidavit in Kepke’s case. It reveals the Internal Revenue Service’s two-decade pursuit of Kepke, a lawyer, accountant, and financial consultant who helps hide billions of dollars in offshore money havens.
Victor Song, former head of IRS Criminal Investigations, said facilitators are crucial. Taxpayers’ money wouldn’t be offshore without criminal conduct. In these circumstances, proving the trust was a sham is critical.
Kepke, 82, pleaded not guilty and will be tried in November. Smith, the creator of Vista Equity Partners, which oversees $96 billion, is charged with conspiracy and fake tax filings. Smith may testify in court.
Smith reportedly paid Kepke $1 million. Kepke’s lawyer didn’t comment.
Smith, the wealthiest Black American with an $8.9 billion net worth, acknowledged using Kepke’s strategy to escape taxes on more than $200 million in 2020. He consented to cooperate with prosecutors and pay back taxes and penalties totaling $139 million as part of a non-prosecution agreement.
A pair of whistle-blowers — a Vista finance officer and divorce investigator hired by Smith’s first wife — also gave information to the IRS. Robert Brockman, a software entrepreneur, was indicted on tax evasion and money laundering charges that accused him of using a complex trust structure in the Caribbean to hide $2 billion in income over two decades. The IRS decided around 2002 against referring a criminal case to prosecutors, an affidavit says. An undercover agent recorded Kepke saying he had used a foreign trust and corporation for the past 27 years.
According to the affidavit, the IRS has expanded its probe to include Brockman’s ex-finance chief, Robert Warnken-Brill Davis. Davis filed two applications for IRS whistle-blower awards and has not been accused of any wrongdoing.
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