[HN Gopher] CrowdStrike CEO cuts his voting power by 92% with un...
___________________________________________________________________
CrowdStrike CEO cuts his voting power by 92% with unexplained gifts
Author : wslh
Score : 119 points
Date : 2025-05-12 12:30 UTC (10 hours ago)
(HTM) web link (www.bloomberg.com)
(TXT) w3m dump (www.bloomberg.com)
| wslh wrote:
| https://archive.is/elJzB
| __alexs wrote:
| Is this 1 or 2 large customers taking a massive stake to avoid
| the business getting sued into the ground? Or perhaps dumping
| equity by the backdoor because they are about to get sued into
| the ground?
| duxup wrote:
| It's classified as a gift, like a charitable donation possibly.
| cj wrote:
| No, when you gift anything over $19,000 (I think) you need to
| file a "gift tax return", and the IRS taxes the gift
| accordingly.
|
| Almost certainly not classified as a charitable donation.
| yojo wrote:
| Minor note: the overage from $19k isn't auto-taxed, it is
| just recorded and counts against your $14M-ish lifetime
| gift tax exemption (also relevant for estate tax).
|
| In this case, he obviously blows past that limit quickly.
| _QrE wrote:
| According to the article, the CEO sold stock, and gifted stock
| to at least four trusts that have, in turn, sold the stock
| gifted:
|
| > Subsequent filings from four trusts show that about half of
| his gifted shares were transferred to them. Those trusts have
| in turn sold most of the shares they reported receiving,
| netting at least $1.2 billion in proceeds so far.
|
| Seems like the CEO thinks that it's downhill from here; I'm not
| sure what other reason there would be to do this.
| pc86 wrote:
| > _A spokesperson for CrowdStrike said the filings reflected
| estate planning and philanthropic activities_
|
| Estate planning is very likely code for tax avoidance. I know
| basically nothing about Kurtz, I would venture this is all
| going to family and structuring this staggering generational
| wealth so they don't overpay taxes.
| lotsofpulp wrote:
| Estate planning is about avoiding probate courts. It makes
| the transfer of control of assets much cleaner with almost
| no risk someone (e.g. an aggrieved family member) can tie
| it up in courts for who knows how long. It's why you see
| even average personal homes placed in trusts.
| pc86 wrote:
| The average personal home is absolutely not placed in a
| trust. It _can_ be but moving your residence into a trust
| for estate planning purposes is not a common thing.
| toast0 wrote:
| It depends on the state. california is known for
| expensive probate and has a lot of turnkey trust
| attorneys with strong marketting. I still don't know that
| ' _the_ average personal home ' is in a trust there, but
| there are lots of 'average personal homes' held in trust,
| not just big fancy houses.
|
| OTOH, California recently added a transfer on death deed
| that may provide a simpler way to avoid probate on homes,
| which may reduce the number of trusts formed just for
| that.
|
| A lot of people leave California and still think they
| need a trust in other states, so trusts in other states
| are growing in numbers as well.
| psunavy03 wrote:
| It's also done if you have, say, a vacation home in
| another state or have other assets which would make
| probate complicated.
| psunavy03 wrote:
| This depends highly on state law and how bad inheritance
| taxes are.
|
| "I have not seen this before" != "this is not common," as
| much as people on the internet tend to confuse the two.
| delfinom wrote:
| I know plenty of average person homes placed into
| irrevocable trusts for avoiding the medicaid seizure by
| parents doing so many years ahead of time as they get
| old.
| SoftTalker wrote:
| My parents did it on advice of their financial advisor.
| Is it common, probably not, most people don't have a
| financial advisor but setting up a revokable trust as
| part of an estate plan is not something that only the
| ultra-wealthy can do. It can make a lot of sense if you
| have any postive net worth to pass along to heirs. A lot
| of people don't, and if you are going to "die broke" (by
| intent or by happenstance) there's no point.
| kube-system wrote:
| "you see even average personal homes placed in trusts."
| is very much not the same sentence as "The average
| personal home is placed in a trust"
| lotsofpulp wrote:
| I did not intend to imply write average personal home is
| placed in a trust.
|
| >It's why you see even average personal homes placed in
| trusts.
|
| This statement meant to convey that people with average
| levels of wealth, such that tax liability is low enough
| such that tax avoidance is not necessary, can also
| benefit from spending a couple thousand dollars with an
| estate lawyer.
|
| Technically, their heirs benefit because they don't need
| to deal with probate court.
| plorkyeran wrote:
| Placing personal homes into living trusts is also done
| for medicaid purposes. If you don't actually own the
| house then medicaid doesn't count it as an asset that you
| have to sell to pay for medical care, and there's a five-
| year clawback so you have to do it well in advance of
| needing it.
| chrisjj wrote:
| How could
|
| > 1 or 2 large customers taking a massive stake avoid the
| business getting sued into the ground
|
| ?
| tills13 wrote:
| The shares are going to the 1 or 2 customers.
| piva00 wrote:
| Rather bizarre move, can it be squared somehow with another weird
| move from CrowdStrike last week, the slashing their workforce
| with the bullshit justification it will be replaced by AI?[0]
|
| Too much of a coincidence in a short amount of time.
|
| [0]
| https://www.theguardian.com/technology/2025/may/09/crowdstri...
| jrexilius wrote:
| Pump the stock up a bit after the "accounting errors"?.. Seems
| like the CEO is trying ot slip out the door before things
| crash?
|
| https://finance.yahoo.com/news/crowdstrike-probed-over-32m-i...
| jlarocco wrote:
| Maybe the decision was recommended by the AI?
| bink wrote:
| "Take a stress pill and think things over."
| crftr wrote:
| > The drawdown in his voting stake has been so dramatic that
| Kurtz in December triggered a clause eliminating all of
| CrowdStrike's super-voting stock...
|
| A plausible explanation.
| malfist wrote:
| Not really. Super voting stock is just for him to retain
| control. This type of behavior is extremely unusual.
| cj wrote:
| Gifting stock to a trust is a common way to avoid certain types
| of taxes in some cases.
|
| If his end goal is to simply liquidate his position, maybe the
| "gifting shares to trust" is just part of a tax avoidance scheme
| (even if it sounds illegal, it often isn't).
|
| I've seen this very commonly with private company founders
| expecting an exit in the next couple years, but very possible
| this situation is completely different.
|
| The fact that it triggered a clause to eliminate preferred voting
| shares is very odd. Either a complete oversight by the guy's
| lawyer, or if it was done intentionally, I have no idea.
| tw04 wrote:
| There's just no way a guy with that much money sells out of the
| controlling stake in his own company without knowing it was
| going to happen.
|
| The billoin dollar question is why? Seems it could only be a
| handful of things:
|
| Major health problem so the controlling stake won't matter.
|
| Major unannounced issue that would cause the stock to drop
| precipitously (on paper he'd be facing prison time, but I think
| we all know he won't even if true).
|
| Outside pressure, presumably from a government entity because I
| don't know what private party would have the juice to push him
| out.
|
| Outside of that, unless he's just done with the rat race,
| planning on retiring and just not working anymore I've got a
| lot of nothing. When you have as much money as he has, I don't
| see why you'd give up control of your baby willingly as part of
| "normal estate planning" at his age.
| nfriedly wrote:
| > _Major unannounced issue..._
|
| To be fair, I'm not sure it could be much worse than the
| major _announced_ issues of the past few years.
| benoau wrote:
| Probably related to replacing 500 positions with what I can
| only assume will be Genmoji.
|
| https://www.theguardian.com/technology/2025/may/09/crowdstr
| i...
| coliveira wrote:
| > pressure, presumably from a government entity
|
| Given the business crowdStrike is, it is now unlikely this
| scheme was setup by some three letter agency from the
| countries involved with this company. So, the control of the
| company is handled by one or more entities they trust.
| baobun wrote:
| Wildly speculating: Maybe he wants to distance himself from
| future events that he can't or won't prevent.
| toast0 wrote:
| Giving to a trust that then sells is also a way to manage
| insider sales restrictions, if the trust acts independently.
| Calwestjobs wrote:
| This does not look like tax avoidance scheme. this looks like
| exit. which is million times better outcome than selling his
| shares to UAE fund. Most disturbing thing is that this company
| deals with most sensitive parts of their customer business and
| this opaqueness from CEO should be ringing alarm bells for any
| company relying on their service.
| robertlagrant wrote:
| > a tax avoidance scheme (even if it sounds illegal, it often
| isn't)
|
| It's never illegal, as far as I know. When it's illegal it's
| tax evasion.
| SecretDreams wrote:
| It's always tax evasion, there are just some forms of tax
| evasion that are legal if you have enough money to make it
| work.
| zdragnar wrote:
| You don't go to court for tax avoidance. You _do_ go to
| court for tax evasion.
| blitzar wrote:
| It's tax evasion if you are found guilty, it's tax
| avoidance if you are found innocent.
| hoofhearted wrote:
| You are never found as innocent within U.S. criminal
| courts. It's only guilty or not guilty.
| 91bananas wrote:
| "You are innocent until proven guilty". Now lets all
| build out our truth tables to check if what he said is
| accurate.
| zahlman wrote:
| Definitionally, "tax avoidance" refers to legal methods,
| and "tax evasion" refers to illegal methods.
| Gathering6678 wrote:
| "The fact that it triggered a clause to eliminate preferred
| voting shares is very odd. Either a complete oversight by the
| guy's lawyer, or if it was done intentionally, I have no idea."
|
| It's probably not an oversight. E.g. in Hong Kong, it is
| mandatory to have a minimum amount of equity (I think 10%),
| otherwise you will lose all super-voting power. I don't think a
| similar requirement is present in the US, but the logic behind
| is valid: the super-voting power is for a founder / important
| member of the company to maintain control and therefore allow
| for a long-term strategy to be carried out, even after multiple
| rounds of financing. If you're no longer a major shareholder
| and working for the company, the super-voting power may no
| longer be appropriate, as your priorities and preferences may
| now differ from the company.
| ghc wrote:
| For all we know, the CEO could have been diagnosed with a
| terminal illness. It's dangerous to read too much into these
| sales without more information, even if the situation is unusual.
| the_sleaze_ wrote:
| It's never a sign of anything good at minimum.
| mwkaufma wrote:
| Can't call a rug-pull a rug-pull when too many speculators are
| still too invested in this hype-cycle.
| jbs789 wrote:
| This could indicate many things but I'm having a hard time seeing
| it as a vote of confidence...
|
| Surprised the stock is up.
| wkat4242 wrote:
| Tbh I'm surprised the company even still exists at all after
| what they did last year.
___________________________________________________________________
(page generated 2025-05-12 23:02 UTC)