Sunday, September 25, 2022

Michael Saylor, co-founder and ex-CEO of software company MicroStrategy, is being sued by the District of Columbia. The prosecutor Karl Anthony Racine announced the news on Twitter.

According to prosecutor Racine, Bitcoin maximalist Michael Saylor lived ”more than a decade” in Washington DC and failed to pay income tax there during that time.

Allegedly, the company MicroStrategy assisted Saylor in concealing tax evasion. That is why the company is part of the legal process.

The lawsuit is the first case to fall under the recently amended False Claims Act of the US state of Washington. This is to “give whistleblowers an incentive to report residents who circumvent our tax laws by providing false information about their place of residence,” Recine explained. This suggests that Saylor may have been blown up by a whistleblower.

The False Claims Act financially rewards whistleblowers for providing information. This is stated in the US law:

“Whistleblowers can be rewarded for the confidential detection of fraud that leads to a financial loss for the state. Provided that the information leads to a successful prosecution, whistleblowers receive a mandatory reward of 15% to 30% of the funds raised.”

According to a Washingtonian news article, Michael Saylor had a fortune of about $7 billion in 2000. Today’s Bitcoin enthusiast was called the “richest person in Washington” at that time (at the age of 35).

In another message, the Prosecutor General warned the citizens of the state and their employers about the consequences that are likely to threaten them with tax evasion:

“If you enjoy all the benefits of living in our great city and at the same time refuse to pay your fair share of taxes, we will hold you accountable.”

Michael Saylor and MicroStrategy’s Bitcoin Strategy

Michael Saylor has been a Bitcoin proponent for a long time. In October 2020, Saylor claimed to own 17,732 Bitcoin, which he bought for under $10,000 per coin. The Bitcoin are worth around 359 million US dollars at the current exchange rate.

The company MicroStrategy, which Saylor co-founded in 1989 and headed as CEO for many years, also invested heavily in Bitcoin. The software company bought the cryptocurrency even during the bull market 2021 continues and currently holds 129,699 BTC (as of June 28, 2022).

At the recent earnings conference call, MicroStrategy announced that Michael Saylor is stepping down from his position as CEO and will assume a new role as Executive Chairman. In the future, Saylor will focus on the Bitcoin acquisition strategy and other related Bitcoin initiatives.

Furthermore, MicroStrategy announced during the conference that it had lost around $ 1 billion due to the declining crypto market. Michael Saylor called this loss however, as a ”big win”.

After the news about the current lawsuit against Saylor, the price of MicroStrategy shares fell by over 6%.

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