The District of Columbia Attorney General’s office has reached a $40 million settlement with Michael Saylor and MicroStrategy, the software company he founded.
This settlement is the largest income tax fraud recovery in Washington D.C. history.
The settlement stems from lawsuits filed in 2021 and 2022 accusing Mr. Saylor of evading more than $25 million in income taxes in Washington.
The Attorney General’s office alleges Mr. Saylor enlisted MicroStrategy’s help to file fraudulent forms claiming he lived in states with lower income tax rates.
MicroStrategy and Mr. Saylor deny any wrongdoing but agreed to the settlement, which includes interest and penalties, to avoid the expense of legal action.
Mr. Saylor, the executive chairman of MicroStrategy, stepped down as CEO in 2022.
He has agreed to pay the full settlement amount as part of a separate agreement with MicroStrategy.
Brian L. Schwalb, the attorney general, said: “Michael Saylor and his company, MicroStrategy, defrauded the district and all of its residents for years.”
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Mr. Saylor maintains his residence has always been in Florida and denies ever being a resident of D.C.
He settled to avoid the continued burdens of litigation.
The lawsuit details Mr. Saylor’s property purchases in D.C. and social media posts suggesting he resided there.
MicroStrategy claims it wasn’t responsible for Saylor’s personal tax affairs and denies any financial contribution to the settlement.
This isn’t the first time the company faced fraud accusations.
This case stemmed from a whistleblower lawsuit empowered by a 2021 amendment allowing tax fraud reporting in D.C.
