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Lawyer testifies his billionaire boss did nothing illegal

Evatt Tamine (Photograph by Sydney Morning Herald)

A lawyer who worked in Bermuda for a billionaire software tycoon and who was scheduled to testify against him at a high-profile tax evasion trial told a court yesterday his former boss had broken no laws in the United States, it has been reported.

Evatt Tamine, who worked for Robert Brockman from 2004 to 2018, became a co-operating witness and granted immunity from prosecution after his Fairylands home was raided by Bermuda police at the request of the US Department of Justice.

He gave evidence three times before a grand jury in the US last year, leading to a 39-count indictment against Mr Brockman, the former CEO of Reynolds & Reynolds, a car dealership software company.

Prosecutors claim Mr Brockman, 80, who denies tax evasion, wire fraud, money laundering, operated a decades-long scheme using a web of offshore entities in Bermuda and Nevis to conceal about $2 billion in income from the Internal Revenue Service.

The case is the largest-ever tax evasion prosecution against an individual in the US.

Mr Brockman’s lawyers said he was unable to stand trial because of dementia.

Mr Tamine appeared as a witness at a hearing yesterday in Houston, Texas, to determine his former employer’s mental competence.

Bloomberg reported that Mr Tamine testified that Mr Brockman was innocent of the charges against him, which the news agency said was “a stunning declaration from a key government witness”.

Mr Tamine was quoted as recounting how he and Mr Brockman took many steps to conceal his boss’s control of a multibillion dollar family trust in Bermuda, including the use of code names, the encryption of communications and destruction of evidence.

Mr Tamine told prosecutors under cross-examination that he did not believe his boss had broken US laws.

Jason Varnado, Mr Brockman’s lawyer, asked Mr Tamine: “Did you tell the US government you think Brockman is innocent and he did everything properly?”

Mr Tamine said: “Yes.”

Mr Varnado asked him: “You told the government some information in the indictment is factually wrong?”

Mr Tamine again agreed.

Bloomberg said it was not immediately clear why Mr Tamine appeared to have broken with prosecutors.

The Australian lawyer told the hearing how he spent 14 years working for Mr Brockman and his trust.

He said he met lawyers at Jones Day, the firm defending Mr Brockman, in 2019 and did not meet prosecutors again until this year.

Mr Tamine also agreed with Mr Varnado when asked if he told prosecutors that he did not engage in tax evasion and money laundering and that he believed Mr Brockman did not have to pay taxes on money until he brought it back to the US.

Mr Tamine said Mr Brockman “never took a nickel” from the A Eugene Brockman Charitable Trust.

But he said that, while he was the trustee, Mr Brockman told him how the money should be used.

Mr Brockman launched the private equity career of Robert Smith in 2000 when he invested in Smith’s Vista Equity Partners, eventually providing at least $1 billion in capital.

Mr Smith avoided prosecution last year when he admitted he evaded taxes, paid $139 million in back taxes and penalties, and agreed to co-operate against Mr Brockman.

Both billionaires used a Houston lawyer, Carlos Kepke, to set up offshore trusts. Mr Kepke has been indicted and has pleaded not guilty.

Bloomberg reported that Mr Tamine admitted in his testimony yesterday that he fabricated a document filed with a bank in Bermuda.

He also said he lied about his reasons for wanting to review Mr Smith’s records at Mr Kepke’s office.

Bloomberg quoted Mr Tamine as acknowledging he could face legal problems in Bermuda and Switzerland, where related investigations are under way and that he did not have immunity.

The Bermuda Police Service told The Royal Gazette in September: “We can neither confirm or deny that we are currently investigating Mr Evatt Tamine.

“We also note that under certain circumstances we cannot in law disclose the existence of an investigation of matters under the Proceeds of Crime Act, which is not an admission or confirmation of any existing investigation.

“The Bermuda Police Service takes its local and international obligations to combat money laundering and all forms of financial crimes very seriously, and we would like to take this opportunity to reassure the public and media that we will continue to work with our international partners to prevent Bermuda’s financial system being used for illicit purposes.”

A judgment from the island’s Supreme Court was issued on Wednesday in connection with civil proceedings regarding two entities in Mr Brockman’s offshore structure, Spanish Steps Holdings and Point Investments Ltd.

The ruling, from Chief Justice Narinder Hargun, noted that Spanish Steps and Cayman-based BCT Limited – the trustee of the A Eugene Brockman Charitable Trust – were pursuing proceedings in Bermuda against Mr Tamine and his company, Tangarra Consultants, “for the return of approximately $28 million which it is alleged to have been taken wrongfully by Mr Tamine from the trust while he had control” over the St John’s Trust Company, the former trustee of the AEBCT.

The judgment said: “Mr Tamine has denied any wrongdoing in this regard.”

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