It’s time to update these top sales charts.
I never would have believed that the domain name fund.com was sold for $10 million in 2008, and now we have proof.
A ruling by the Court of Chancery in Delaware shows that the $10 million sale was faked as part of a stock pump-and-dump scheme. According to court documents, the purchase price was manipulated through fraudulent transactions.
The domain was later offered for sale by domain broker Igloo and broker Media Options finally sold the domain in 2018.
The story of the company going bankrupt became even more interesting when an investor later claimed a tax loss from the sale of the domain.
Braziela (investor) engaged in a tax avoidance strategy based primarily on the company claiming a net operating loss (the “NOL”) of $8.725 million from the sale of the website address. To support the NOL, Braziel started with the $10 million purchase price for the website address that Galanis had fabricated. He then added the commission for selling the website address to a third party. He then subtracted the final sale price of $1.5 million ($10,000,000 + $225,000 – $1,500,000 = $8,725,000)…
…Braziel knew from his research into the company that the $10 million purchase price for the website address was not a legitimate number. It was a number invented by Galanis to support a pump-and-dump scheme, and it was many times higher than the price the website address had actually been sold for in three subsequent transactions. Braziel used the $10 million figure nonetheless.
You can read the full decision here (pdf).
