Robert Brockman, the previous CEO of dealership administration system large Reynolds and Reynolds Co. who constructed a multibillion-dollar fortune as a software program entrepreneur earlier than he was indicted in a landmark tax-evasion case, has died. He was 81.
Brockman, who was affected by dementia and present process dwelling hospice care, died late Friday, mentioned Kathy Keneally, his legal professional. He’d been preventing tax-evasion costs since 2020, however his attorneys mentioned his dementia meant he wasn’t competent to face trial.
A choose dominated in Could that Brockman was competent. At a listening to a month later, the choose tentatively set his trial date for Feb. 23, 2023. Brockman appeared in mattress through video throughout that listening to.
“The federal government wasted time and sources indicting a person who had progressive dementia and was terminally in poor health,” Keneally mentioned.
In his youthful days, Brockman was referred to as an inexhaustible employee with a ardour for bodily health, fly fishing in Colorado and dove looking in Argentina. Forbes estimated his internet value to be $4.7 billion.
A Florida native of modest origins, Brockman was promoting computing companies to auto sellers on behalf of Worldwide Enterprise Machines Corp. when, in 1970, he based an organization that helped revolutionize how the trade operates in North America and Europe.
Along with the supplier administration software program system, Brockman, a self-taught programmer, obtained greater than a dozen patents, and grew Reynolds and Reynolds right into a 5,000-person operation value some $5 billion.
As Brockman constructed his firm into an trade drive, he additionally defended quite a few lawsuits accusing him of bare-knuckled enterprise practices. Salespeople accused his firm of stiffing them on funds; auto sellers mentioned he tricked them into costly multiyear contracts. The Federal Commerce Fee investigated whether or not he engaged in anti-competitive practices.
A former Marine reservist who surrounded himself with loyal lieutenants, Brockman had an intense want for private privateness that prolonged to his dealings with the Inner Income Service.
“Brockman had one rule: Don’t do enterprise with the federal government,” mentioned Robert Tyson, an entrepreneur who gained a lawsuit in opposition to Brockman for unpaid compensation for companies rendered. “He didn’t need the feds something.”
In October 2020, the US charged Brockman within the largest tax-evasion case ever in opposition to a person, in addition to on money-laundering costs.
Burner Telephones
Brockman helped launch the non-public fairness profession of Robert F. Smith, America’s wealthiest Black citizen, by offering the preliminary funding in his agency, Vista Fairness Companions. Prosecutors alleged Brockman used an online of offshore entities, code names and burner telephones to cover $2 billion in revenue from the IRS, most of it earned by way of Vista investments.
Smith admitted committing tax crimes however averted prosecution by cooperating with prosecutors in opposition to Brockman.
The case in opposition to Brockman hinged on whether or not billions of {dollars} in an offshore charitable belief have been secretly managed by him, as prosecutors alleged, or have been independently managed, as he claimed. Prosecutors mentioned he used untaxed proceeds from offshore entities to purchase a Colorado fishing lodge, a non-public jet and a 200-foot yacht, which his legal professionals denied.
“I’ve not seen this sample of greed or concealment and cover-up in my 25-plus years as a particular agent,” James Lee, an IRS official, mentioned when the fees have been filed.
Brockman pleaded not responsible, however his legal professionals quickly started arguing that dementia left him unable to help in his protection.
Robert Theron Brockman was born in St. Petersburg, Florida, on Could 28, 1941. His father, Alfred Eugene Brockman, owned a fuel station. His mom, Pearl, was a physiotherapist. With the household struggling financially, Brockman “determined he didn’t love that and went out to make one thing of himself,” his youthful brother, David, informed the Wall Avenue Journal in 2021.
Seeding Vista
After graduating summa cum laude from the College of Florida in 1963, Brockman labored as a advertising trainee at Ford Motor Co. earlier than transferring to IBM, the place he grew to become a high salesman in Washington and Houston. In 1970, he arrange his personal agency, Common Pc Techniques, and started offering auto dealerships with weekly stock experiences.
As Brockman constructed his firm, he met Smith, then a rising Goldman Sachs expertise funding banker. Brockman later seeded Smith’s agency, Vista, with at the least $1 billion in funds to purchase out enterprise software program corporations.
The companions structured their association to maintain income offshore, prosecutors say.
In 2006, Brockman introduced his software program and investing pursuits collectively to engineer the acquisition that thrust UCS into the large leagues. Brockman’s intently held agency purchased Reynolds & Reynolds, a public firm practically twice its dimension. A part of the fairness financing got here from Vista’s authentic fund, wherein Brockman was the only real exterior investor.
The mixed agency took the Reynolds & Reynolds title and was managed by a Bermudian charitable belief arrange within the title of Brockman’s father. As Brockman’s wealth grew, so did the belief’s offshore property.
Along with the $5 billion value of software program firm holdings, they included $1.3 billion in investments made by way of an entity based mostly within the British Virgin Islands and $1.4 billion in a Swiss financial institution, his spouse, Dorothy, mentioned in an affidavit filed in a Bermudian court docket.
Assist for Opera
The Bermudian belief and the Brockmans additionally grew to become lively philanthropists. Their presents included tens of tens of millions of {dollars} to the Baylor School of Drugs, the place Brockman was a trustee, and the Brockman Corridor for Opera at Rice College in Houston. Additionally they supported dozens of scholars with scholarships.
Nonetheless, in 2018 US tax authorities raided Brockman’s attorneys in Houston and Bermuda. They uncovered a cache of encrypted paperwork and messages that prosecutors utilized in constructing their prison case in opposition to Brockman.
In September 2021, the IRS assessed Brockman for $1.4 billion, associated to taxes it mentioned he owed from 2004 to 2018. The case is pending in US District Court docket and Tax Court docket, and the battle in opposition to his property may final years.
“Whether or not Bob Brockman actually owed extra taxes, which we dispute, can await a call by the Tax Court docket,” Keneally mentioned.
He’s survived by his brother David; his spouse of 53 years, Dorothy; a son, Robert Brockman II; a daughter-in-law; a grandson; and a granddaughter.