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Bitcoin billionaire Michael Saylor settles Washington tax fraud case for $40 million

Michael Saylor, executive chairman of MicroStrategy.

Valérie Plesch | Bloomberg | Getty Images

Billionaire Bitcoin investor Michael Saylor and the company he founded, MicroStrategywill pay $40 million to settle a tax fraud lawsuit filed by the Washington, D.C. attorney general, the AG’s office announced Monday.

Between 2005 and 2021, Saylor allegedly evaded more than $25 million in District of Columbia income taxes by posing as a resident of low-tax states like Florida and Virginia, the attorney general claimed Brian Schwalb in a 2023 civil complaint.

According to the suit, Saylor’s real home was a luxury penthouse in Washington overlooking the Georgetown waterfront, where he kept his yachts on the Potomac River.

Saylor founded Virginia-based MicroStrategy in 1989 as a software consulting firm and pioneering data analytics company, and took the company public in 1998 on Nasdaq. He served as CEO of MicroStrategy until 2022, when he rose to the role of executive chairman.

In 2020, Saylor pivoted the company toward the crypto market and since then, he has amassed billions of dollars in crypto.

Saylor’s net worth as of June 2 was approximately $4.6 billion, according to Forbes. He also owned 2.4 million shares of MicroStrategy, or a 13% stake in the company, as of February.

MicroStrategy stock closed at $1,524.49 per share Friday.

The DC attorney general accused Saylor and MicroStrategy of tax evasion, saying the company helped its founder conceal his DC residency so he could avoid paying higher income taxes.

MicroStrategy also allegedly failed to pay required corporate taxes for a company employing Washington, D.C. residents, of which Saylor was just one.

The original lawsuit against Saylor was filed in 2022 by former DC Attorney General Karl Racine. It was sparked by a whistleblower lawsuit in 2021 that claimed Saylor cheated on his taxes and bragged about it to his friends.

This lawsuit alerted the attorney general’s office, which then conducted its own investigation and filed civil charges.

The case against Saylor was the first brought under an updated version of the False Claims Act in the District of Columbia. The update expanded the attorney general’s tax enforcement powers and incentivized whistleblowers to come forward by offering rewards of up to 25 percent of the district’s winnings if successful.

According to the attorney general’s account, Saylor had lived in the same luxury building overlooking the Georgetown waterfront since at least 2005.

From 2006 to 2008, Saylor purchased three luxury condos in Washington which he then renovated into a single complex he called the “Trigate.” During renovations from 2011 to 2015, Saylor reportedly stayed between his yachts, his penthouse and another apartment in Washington’s Adams Morgan neighborhood.

The civil complaint cited several Facebook posts on Saylor’s account from around the time of the home’s renovations.

“I look wistfully at my future home while I wait for James to blow up the contractors and herd the cats,” Saylor wrote in a 2012 article. “I wonder if Tony Stark would be so patient…”

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