Private equity billionaire Robert F. Smith is expected to testify for the prosecution at the trial of the lawyer who allegedly helped him evade taxes over a decade.
Vista Equity Partners founder Smith was on a list of witnesses Justice Department lawyers filed Monday in federal court in San Francisco ahead of the Nov. 28 trial of Houston trust lawyer Carlos Kepke. The 83-year-old Kepke has pleaded not guilty to charges of conspiracy and aiding in the preparation of false tax returns by Smith.
Smith, 59, avoided prosecution himself in 2020 by admitting he used offshore entities to hide more than $200 million in Vista income. The billionaire indicated Kepke set up the entities and said he paid the lawyer $800,000 to help maintain one trust and create a false paper trail. Smith agreed to pay $139 million in back taxes and penalties, as well as cooperate in other investigations.
A spokesperson for Smith and the Justice Department declined to comment. A lawyer for Kepke didn't respond to requests for comment.
Vista manages $94 billion in assets, and Smith is worth an estimated $11.9 billion.
Other witnesses on the prosecution list include former Vista finance director Denise Davis and Robyn Neal, who worked at Switzerland's Banque Bonhote, where Smith had accounts he concealed from the Internal Revenue Service. According to court records, Davis applied to the IRS for a whistleblower award.
Jurors are also expected to hear from Emil Arguelles and Glen Godfrey, who worked at Cititrust International Ltd., a company in Belize that allegedly served as trustee for an entity controlled by Smith. Arguelles is a former speaker of the house of representatives in Belize.
Three of Smith's tax preparers and an unidentified undercover agent are also expected to testify, according to the filing.
Kepke worked for decades to help US clients set up offshore trusts, which are often used legally for tax and estate planning. IRS agents twice targeted the lawyer for undercover operations, court records show.
The case is U.S. v. Kepke, 21-cr-00155, U.S. District Court, Northern District of California (San Francisco).
