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Billionaire private equity titan Robert F. Smith has apologized to his investors after a $140 million settlement of an investigation into his personal finances, describing it as a “humbling experience.”
The Department of Justice said this week that the backer of Smith’s first private equity fund led Smith to use an offshore trust, which concealed $200 million of income from the IRS and helped Smith evade $43 million in federal income taxes.
Smith paid a $139 million settlement and avoided prosecution, but the revelations still incited chaos inside his software-focused private equity fund Vista Equity Partners, Axios reported.
A representative for Smith declined Business Insider’s request for comment on his non-prosecution agreement with the Department of Justice.
In a letter to investors, viewed by Business Insider, Smith apologized for his actions and expressed hope for the future.
“The decision made twenty years ago has regrettably led to this turmoil, which has put undue stress and burden
on too many,” Smith wrote. “I should never have put myself in this situation, and more importantly, I apologize for any issues or concerns that this may have caused for you.”
Remarks from Smith’s letter to Vista investors are published in full below.
I want to address with you the resolution of my tax matter with the Department of Justice.
I have entered into a settlement with the Department of Justice called a non-prosecution agreement, or NPA.
This agreement resolves all aspects of what was a personal tax matter.
No Vista Equity Partners entity is part of the settlement and the Department of Justice never claimed that Vista or any Vista funds were involved or under investigation. Importantly, the Department of Justice has never suggested that any Vista client money was misapplied, misused, or diverted. All of our funds are audited by Deloitte and there has never been any issue raised with respect to the accounting of our investors’ money. Your money has always been safe and invested appropriately.
Since first learning about the Department of Justice’s investigation, I have cooperated fully for the last four and one-half years and have provided all relevant information to them. Recently, the Department of Justice offered to resolve this matter with me. I decided that the best thing for Vista, including its employees and our investors, my family and me, was to resolve the matter by entering into the NPA. Under the NPA, I have admitted my culpability, I will pay full restitution …read more
Source:: Business Insider