A U.S. judge denies a motion by former MicroStrategy CEO Michael Saylor to dismiss tax evasion charges filed against him in August last year.
The judge also dismissed allegations by a whistleblower that MicroStrategy conspired with Saylor to transgress the jurisdiction’s False Claims Act by making misleading statements about the billionaire’s residence.
Michael Saylor Adamant on Residency Claims
Following the ruling, Saylor still faces accusations by the D.C. Office of the Attorney General that he failed to pay income tax to the District of Columbia despite living there for ten years and docking yachts on the Potomac and Georgetown waterfronts.
Saylor, for his part, has denied living in the area, claiming he resides in Florida. The former CEO and current Executive Chairman told Bloomberg, “I continue to respectfully disagree with the district’s position on the remaining claims, and I will continue to defend against those claims. I look forward to an appropriate resolution of this case in due course.”
The District of Columbia’s Superior Court is the only local trial court handling tax, criminal, civil, and family court cases. It also handles appeals from administrative agencies like the Department of Public Works. It employs one chief judge and 49 associate judges. Saylor’s tax evasion would fall under the civil responsibility of the Superior Court.
Saylor, a bitcoin maxi, stepped down as the CEO of MicroStrategy in Aug. 2022, assuming the role of Executive Chairman to lead the firm’s Bitcoin strategy. Under Saylor’s direction, the firm added about 2,395 Bitcoin to its stockpile between Nov. 2, 2022, and Dec. 21, 2023, taking its Bitcoin holdings to about 132,500.
MacroStrategy Loan Will Not Cause Silvergate Insolvency
Last year’s Bitcoin market rout drew considerable attention to MicroStrategy after it was revealed that the firm’s MacroStrategy subsidiary took out a Bitcoin-backed loan from beleaguered crypto bank Silvergate Capital in March 2022. Saylor repeatedly denied claims that the firm would have to liquidate some of its Bitcoin in a margin call.
Now, even as the bank faces headwinds and threats of insolvency following the departure of major partners Coinbase and Galaxy Digital, questions have arisen on whether a decline in the collateral value of MicroStrategy’s loan could push Silvergate over the edge.
However, the software firm was adamant that its $205 million loan is due in 2025, and the Bitcoin collateral is not held by Silvergate. Therefore, any Bitcoin price drop would not cause the bank to become insolvent.
California-based Silvergate told the U.S. Securities and Exchange Commission that it would delay its annual report after selling securities at a loss to service debts. The bank faces allegations of collusion with former FTX boss Sam Bankman-Fried to mix FTX customer funds with those of FTX affiliate Alameda.
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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.
