Tech entrepreneur, video app boss pleads guilty to felony tax evasion

An IRS investigation accused "serial entrepreneur" Uri Raz of not reporting $2 million on tax returns.SAN JOSE, Calif. (CN) — The executive chairman and co-founder of a live-video and mobile messaging app was charged and pleaded guilty Monday to felony tax evasion.Uri Raz, co-founder, former CEO and current executive chairman of Tango, a live-video app similar to TikTok, accepted a plea agreement that includes over $23 million in restitution.The felony tax evasion charge generally applies for amounts greater than $3.5 million in tax loss. The charge includes penalties of a maximum of five years in prison, over $100,000 in fines and three years of mandatory supervised release.Raz — dressed in a black suit with a light blue patterned tie, and out of custody on an unsecured $1 million bond at his initial appearance — was taciturn standing next to his retained attorney Lawrence Spiegel of the New York firm Skadden, Arps, Slate, Meagher & Flom.Immediately after his appearance, a second hearing with U.S. District Judge Noel Wise included a change of plea from not guilty to guilty. If Wise, a Joe Biden appointee, decides to accept the government’s recommendations for a plea agreement, Raz will not go to prison, but must pay over $23 million in restitution and over $1.2 million in fines.Wise was hesitant to say whether she will accept the agreement, she noted, because she hadn’t yet received a report about Raz’s criminal history. While discussing his terms of release, it was agreed that, under a guilty plea, he would remain out of custody on a $5 million secured bond.Raz may also face possible immigration consequences such as deportation, as he has renounced his U.S. citizenship. His property, including assets he may own in Israel, the country of his birth, may be subjected to liens to pay the restitution.Based on information from an Internal Revenue Service investigation and a criminal complaint, the government claims in 2000 Raz created an overseas entity called Herodiun Limited in the Republic of Mauritius and connected it to a Swiss bank account. In 2008, Raz put over $2 million in the account, following a severance agreement.Raz did not include the $2 million in his 2008 federal tax return, which he would have been responsible for over $600,000 in tax due, U.S. Assistant Attorney for the Department of Justice Tax Division Charles O’Reilly said.“Do you agree all of those facts are true?” Wise asked Raz.“Yes, your honor,” answered Raz.Raz has been described as a “serial entrepreneur.” He created AppStream, a streaming software application, that was sold to cybersecurity brand Symantec in 2008.The Tango app is a social media platform that streams short, live videos from creators to audiences worldwide, and was valued at over $1 billion in 2016.Raz stepped down as CEO of the company in 2016 but remained at the company as executive chairman. Apple removed Tango from its app store in 2024, citing policy violations related to content and safety. The app is still available for Android and outside the U.S. through other app marketplaces.Raz’s sentencing hearing is scheduled for Nov. 10.Subscribe to our free newslettersOur weekly newsletter Closing Arguments offers the latest about ongoing trials, major litigation and rulings in courthouses around the U.S. and the world, while the monthly Under the Lights dishes the legal dirt from Hollywood, sports, Big Tech and the arts.Additional Reads