WASHINGTON — Attorney General Karl Racine is suing a D.C. tech billionaire who he says has been living in the District for more than a decade - but has never paid any taxes.
The lawsuit names Michael J. Saylor and the publicly-traded data tracking software company he co-founded, MicroStrategy, based out of Northern Virginia.
The company is alleged to have conspired to help Saylor evade the taxes he owes.
The Office of the Attorney General (OAG) alleges that he illegally avoided more than $25 million in D.C. taxes and that he did so by pretending to be a resident of other jurisdictions with lower personal income taxes.
"OAG also alleges that MicroStrategy had detailed information confirming that Saylor was, in fact, a DC resident, but instead of accurately reporting his address to local and federal tax authorities and withholding DC taxes, collaborated with Saylor to facilitate his tax evasion," the office said.
The office said that it's bringing the fraud enforcement action under a recently updated law - the False Claims Act - that holds people accountable and lets whistleblowers who report tax fraud collect a percentage of the recovered money.
“D.C. residents and their employers are now on notice that attempts to evade the District's income tax laws by falsely claiming that they reside in another jurisdiction will be investigated and, if substantiated, held accountable,” Racine said.
The office shared that in April 2021, whistleblowers filed a lawsuit against Saylor, alleging that he had defrauded the District and failed to pay income taxes he legally owed from 2014 through 2020.
The suit goes on to allege that Saylor perpetuated an illusion that he lived in Florida, a state without a personal income tax. The complaint, according to Racine's office, includes detailed allegations that Saylor was physically present in DC for most of each year, as exemplified by allegations featuring flight logs from MicroStrategy’s corporate jet and location-tagged social media posts.
OAG also stated that the whistleblowers’ complaint alleges Saylor "openly bragged to friends and acquaintances about evading DC taxes and encouraged others to follow his example."
After the OAG independently investigated the tax fraud allegations against Saylor, the office intervened and filed its own complaint against both Saylor and MicroStrategy.