Robert Brockman, a software entrepreneur who made a massive fortune before being indicted in the largest individual tax evasion case in US history, has died. He was 81.
Brockman’s attorney, Kathy Keneally, said that the billionaire was suffering from dementia and living at home in hospice care when he died Friday night.
Lawyers for Brockman said he wasn’t able to fight the massive tax evasion charges due to his illness but a judged ruled him competent in May.
Brockman was born in Florida to a modest upbringing with a gas station owner father and physiotherapist mother, according to Bloomberg but died with a net worth of about $4.7 billion.
He made his riches teaching himself programming and eventually developing software that allow vehicle dealers to run business more efficiently.
The 81-year-old left behind his wife of 53 years, Dorothy and a son Robert II; as well as his brother David, a daughter-in-law and two grandchildren.
Brockman was indicted in 2020 on 39 counts, including wire fraud, tax evasion and money laundering that the U.S. Department of Justice said totaled a $2 billion scheme to conceal his income and defraud investors of his Reynolds and Reynolds company.
Robert Brockman, a software entrepreneur who made a massive fortune before being indicted in the largest individual tax evasion case in US history, has died. He was 81
The 81-year-old left behind his wife of 53 years, Dorothy (pictured right) and a son Robert II; as well as his brother David, a daughter-in-law and two grandchildren
In filings submitted to court in April, Brockman’s defense said he contracted COVID in December, which caused him to be hospitalized over toxic metabolic encephalopathy (TME), an acute cerebral dysfunction. They claimed COVID and TME has worsened his dementia. A judge, however, ruled him competent in May
Brockman’s lawyers, however, have argued that the billionaire is not competent to stand trial, claiming in filings submitted in April that his Parkinson’s disease caused dementia, which only grew worse after he contracted COVID in December.
In the filings, the lawyers said Brockman was hospitalized in January with toxic metabolic encephalopathy (TME), an acute cerebral dysfunction that can be caused by COVID, claiming that, ‘For patients already suffering from dementia, COVID-19 and TME can exacerbate the existing dementia and accelerate cognitive decline.’
The lawyers added: ‘During a February 15, 2022 examination by Dr. James Pool, Mr. Brockman’s primary care physician, neuropsychological testing was performed to assess Mr. Brockman’s current cognitive status. Dr. Pool concluded that Mr. Brockman’s condition had progressed to severe dementia.’
The attorneys also noted that follow-up testing backed-up the conclusion that Brockman was less mentally competent than when the software tycoon had his last evaluation in October.
George Hanks, the judge presiding over the case, had previously heard arguments about Brockman’s dementia claims in November but has yet to rule on the issue.
The case involving Brockman accuses him of hiding $2 billion in income from the IRS over two decades using a web of off-shore companies in Bermuda, and St. Kitts and Nevis.
The indictment alleged Brockman appointed nominees to manage the off-shore entities for him as a means of hiding his involvement, saying he even went so far as to establish a proprietary encrypted email system and use code words such as ‘Permit,’ ‘Red fish’ and ‘Snapper’ to communicate.
The prosecution claims Brockman’s sprawling network of offshore trusts grew to The Cayman Islands, Singapore, the British Virgin Islands and the Isle of Man.
Authorities had been investigating Brockman over the tax fraud allegations for several years and prosecutors claim he found out about the probe as early as 2016.
Prosecutors allege that Brockman started seeking medical evaluations for his mental health shortly after a 2018 raid on his attorney’s home in Bermuda, according to court documents obtained by the Wall Street Journal.
A doctor found in March 2019 that Brockman had poor short-term recall. Prosecutors claim, however, that Brockman’s doctors have a conflict of interest because they work with the Baylor College of Medicine, of which the billionaire has donated millions of dollars to over the years.
They also argue that Brockman continued to head his software company during this time despite his alleged mental decline. Court documents reveal he took a cognitive test late last year and had difficulties drawing a clock, with a doctor ruling he had ‘moderate dementia’.
The case involving Brockman (left) accuses him of hiding $2 billion in income from the IRS over two decades using a web of off-shore companies in Bermuda and St. Kitts and Nevis
The Department of Justice outlined the sprawling web of offshore accounts Brockman controlled that allegedly allowed him to withhold $2 billion in taxes
The software tycoon lives in his $8 million mansion (pictured) in Houston, Texas. He also owns a 143-acre Colorado property and fishing lodge on the Frying Pan River
Along with his properties, Brockman owns a 209-foot yacht named ‘Turmoil’ (pictured)
Prosecutors said he also owns a Bombardier Inc. Global 6000 private jet worth about $62 million
The $62 million jet typically features a spacious and luxurious cabin room for its wealthy fliers
Fellow billionaire Robert Smith, who is the CEO of a private equity firm that aided in the alleged schemes, was cooperating with the investigation after turning against Brockman to avoid prosecution himself.
Smith, the richest black person in America with a net worth about $7 billion, has also been ordered to pay $139 million in back taxes and penalties.
Brockman and Smith have a business relationship dating back to the late 1990s, according to documents filed in connection with Smith’s non-prosecution agreement.
The majority of his fortune is believed to be held in a trust in Bermuda that owns most of his software company. Court documents show the trust has assets worth at least $7 billion.
Even though that wealth would likely see him ranked about 50th on the Forbes 400 list of billionaires, Brockman hasn’t ever appeared on the list as without the inclusion of the alleged hidden funds, Forbes ranks him at 601 with $4.7 billion.
Fellow billionaire Robert Smith, who is the CEO of a private equity firm that aided in the alleged schemes, is cooperating with the investigation after turning against Brockman to avoid prosecution himself
Prosecutors said he owns a Houston mansion worth an estimated $8 million, an Aspen, Colorado ski cabin, a Bombardier private jet and a a 209-foot yacht.
According to court filings obtained by Bloomberg last year, the government has been trying to seize the 143-acre Colorado property and fishing lodge on the Frying Pan River and a trove of cash in Switzerland’s Mirabaud Bank tied to the fraud case.
Prosecutors, however, believed Brockman (above) – was faking his mental decline to avoid standing trial
The outlet reported that prosecutors in the United States first sought forfeiture of the Mirabaud account in October 2020 and that Swiss prosecutors have frozen more than $1 billion held in bank accounts belonging to Brockman.
The 42-page indictment against Brockman names two Colorado properties of interest in the case.
According to the indictment, Brockman paid $15 million to purchase the ‘Mountain Queen’ property located in Pitkin County on May 17, 2005.
He later spent another $15 million of funds allegedly obtained through debt fraud on the ‘Frying Pan Canyon Ranch’ in Pitkin County on December 16, 2010, according to the indictment.
Brockman allegedly spent another $8.2 million on renovations and improvements to the Frying Pan Canyon property in 2014.
It was not immediately clear if the asset forfeiture reported by Bloomberg also includes the Mountain Queen property or his Houston mansion.
As the case against Brockman continued, his former associates and employees painted a picture of him as a penny-pinching billionaire who believed the IRS unfairly went after taxpayers.
Brockman, who had a reputation for being litigious, would stay at budget hotels and ate frozen dinners on business trips.
He would buy used furniture for his offices and banned his employees from smoking so the company could save on health insurance.
At the time of the indictment, Reynolds & Reynolds issued a statement saying the allegations were outside Brockman’s work with the company and that the company is not alleged to have participated in any wrongdoing.
The software helps set up websites, including live chats with potential customers, find loans and calculate customer payments, manage payroll and pay bills.
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