Breaking Bitcoin ‘Maximalist’ Michael Saylor Sued for Tax Fraud in DC

31 August 2022, 18:17 GMT+0000
Updated by Ryan James
31 August 2022, 19:56 GMT+0000
In Brief
  • The Attorney General for the District of Columbia filed a lawsuit against Michael Saylor and MicroStrategy.
  • The lawsuit claims Saylor didn’t pay income tax for the entire time he lived in DC.
  • MicroStrategy stock fell by 6% following the news.
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Michael Saylor, founder and former CEO of the software company MicroStrategy, is being sued by the District of Columbia, DC Attorney General Karl Anthony Racine, announced on Twitter. 

According to Racine, Saylor has been living in the district for “more than a decade” and has failed to pay income taxes. 

The AG also alleged that MicroStrategy helped Saylor cover the tax fraud up and thus is also subject to the lawsuit.

The lawsuit is the first case that falls under DC’s “recently amended” False Claims Act, which encourages “whistleblowers to report residents who evade our tax laws by misrepresenting their residence” Recine said, hinting that there might be whistleblowers involved in Saylor’s case.

The False Claims Act encourages whistleblowers to provide information and rewards them financially for doing so.

“Whistleblowers can be rewarded for confidentially disclosing fraud that results in a financial loss to the federal government. Provided that their original information results in a successful prosecution, whistleblowers are awarded a mandatory reward of between 15% to 30% of the collected proceeds,” the law says

According to a Washingtonian article from 2000, Saylor, who was 35-year-old at the time, had a fortune of $7 billion, calling him “the richest person in Washington.”

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The Attorney General also warned that the state’s residents and their employers have been put on “notice.”

“If you enjoy all the benefits of living in our great city while refusing to pay your fair share in taxes, we will hold you accountable.”

Saylor is a long-time proponent of Bitcoin (BTC), revealing in October 2020 that he owned 17,732 bitcoins (almost $359 million at press time), which he had bought for under $10,000 per coin.

MicroStrategy, which Saylor founded in 1989 and led as CEO by August 2022, also put Bitcoin on its balance sheet. The company has been buying the cryptocurrency even during bull markets and now holds 129,699 bitcoins as of June 28, 2022. 

During the latest earnings call on Aug. 2, the company announced that Saylor was stepping down from his CEO position and transitioning to his new role as an executive chairman, where he would focus on Bitcoin acquisition strategy and other related bitcoin initiatives.

During that same call, MicroStrategy revealed that it took a $917.8 million impairment charge caused by the crypto market drop. 

MicroStrategy stock fell over 6% following the news about the lawsuit.

For Be[In]Crypto’s latest Bitcoin (BTC) analysis, click here.

Disclaimer

BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.