American billionaire and investor Robert F. Smith got into a lot of trouble around last year, and we are here to tell you all about it. The sixty-year-old businessman is the founder and chairman of his extremely successful firm called Vista Equity Partners, a private equity firm that has, since its foundation, been investing in a lot of big firms, including Marketo, Identity, Ping, and others.
Smith is known to have attended Cornell University, where he studied chemical engineering, after which he decided to get his Master’s in Business Administration from Columbia University.
Just as his student life ended, Smith pursued work at all kinds of firms and companies, continuously expanding his knowledge and gaining insight into how to run a business, only to set the foundation for his firm in the year 2000.
Over the years of running his precious firm, Vista Equity Partners has grown enough to not only make him a billionaire but has also become the fourth biggest enterprise software brand for other big names like Microsoft and Oracle, among many others.
By the end of 2019, the company had managed to raise funding of more than $46 billion. Not only has Smith managed to bring his firm to such a high level of success, but he has also made sure to be an active philanthropist.
He is known to have signed a pledge to devote the majority of his earnings to social causes and has, at different times, spoken about the racism, antisemitism, and microaggressions that minorities have to face in the United States. He is also known to have helped students of Morehouse College with their student loans and debts.
It seems like it has gone downhill for both Robert Smith and his firm since 2020, when allegations of tax evasion and fraud surfaced, causing a string of controversies for the businessman.
Robert Smith’s Controversy
Controversy regarding Smith’s tax evasion on total assets worth $200 million broke out sometime in late 2020. Though the news did not get much response from the public, the company suffered heavily and is still facing issues because of it.
While the failure to pay taxes tainted Smith’s reputation quite badly, he chose to pay a hefty fine of $139 million after coming to an agreement with the United States Department of Justice.
He was not persecuted and did not have to face any trial as it was revealed that he also agreed to sit as a witness and help the Department of Justice build a case against another Robert T. Brockman.
The latter was revealed to have kept a total of $2 billion hidden from his known income. The amount is extremely large, and Smith agreed to be a witness for the case, thus brushing his own case under the carpet by paying a petty fine.
It was revealed that Brockman had been hiding his income and evading taxes by setting up offshore trust funds outside of the United States. While the entire scandal did not even get to see the day’s light, it was and still continues to be a big deal in the finance world full of billionaires who now seem to be cautious in working with Smith and his firm.
Though Smith’s acts of service have helped him get support and backing from all those who benefitted from his philanthropic acts. The company struggles to gain back the trust of original investors, who have now become extremely cautious and seem to not want to associate with Vista Equity Partners at all. The fact that Smith agreed to pay a fine of $139 million and become a witness against Brockman’s case seems to be not sitting all that well with investors.
The company insiders have revealed that though things may be tough for the firm right now, they are still better off than if Smith had been persecuted. Robert Smith went from being an investment banker to a billionaire with a net worth of around $6.7 billion, all because of his own efforts.
He is crucial to the company and its success and has, since the scandal, revealed that he is working hard to put the firm right back on track and turn things around.
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