Update, March 18, 2016: King County property records show that two deeds of trust have now been recorded on Dan Price’s home in Seattle’s Magnolia neighborhood, indicating that Price has borrowed money against the property.
Update, February 2016: In a court filing, Dan Price acknowledges that his homes haven’t been mortgaged, saying that he “attempted to mortgage my home and rental property, but so far these loans have been denied based on the ongoing lawsuit” brought by his brother, Lucas Price. Original story follows.
Dan Price, the Gravity Payments CEO who won international attention for his promise to raise employee salaries to a $70,000 minimum, has been facing new questions about inconsistencies in his story, and here’s a new one: Price hasn’t actually taken out any mortgages on his two homes in Seattle, property records show — contrary to what he told Inc. magazine for a cover story about the aftermath of his announcement.
Research conducted by GeekWire, and verified with real estate and property title professionals, shows no recorded mortgage on either of Price’s properties in Seattle: a two-bedroom condo on the edge of Seattle’s Queen Anne neighborhood; and a three-bedroom home in the Magnolia neighborhood, which Price purchased for $892,000 in 2012. The larger Magnolia home has since risen in value to more than $1.2 million, by some estimates.
Inc. referenced both homes in its cover story, saying that Price “revealed to Inc. that he has sold all his stocks, emptied his retirement accounts, and mortgaged his two properties — including a $1.2 million home with a view of Puget Sound — and poured the $3 million he raised into Gravity.”
The statement, meant to illustrate Price’s personal financial sacrifice, has been picked up repeatedly by other media and become part of the broader narrative around Price. The Gravity Payments CEO has won a crush of publicity from his controversial move to institute the $70,000 minimum salary and simultaneously reduce his own salary — previously $1.1 million — to the same amount, to help fund the pay raises for his employees.
“I wanted a larger margin for error,” Price told CNN Money in October, referencing his decision to mortgage his properties and sell stock.
Price owns two properties in Seattle, and public records would show a mortgage if there was one. When a mortgage is made on a house, a deed of trust is recorded publicly to confirm that there is a mortgage lien on the house and to secure the lender’s collateral interest in the property.
Over the past few days, neither Price nor a Gravity Payments spokesman has responded to messages from GeekWire, asking them to explain the inconsistency between Price’s statements and King County property records. In an email, Paul Keegan, the author of the Inc. piece, said the magazine fact-checked Price’s statement, but Keegan has not responded to our question about whether that process included checking property records.
“For a comment on what your reporting turned up, you should talk to Price,” the reporter said in an email.
Separately last week on Twitter, Keegan criticized the recent Bloomberg Businessweek story that contained new revelations about Price.
— Paul Keegan (@paulkeegan) December 4, 2015
The Bloomberg Businessweek story provided new details about the timing of Price’s minimum salary announcement in relation to a lawsuit filed by his brother, Lucas Price, a minority shareholder in Gravity Payments, over his brother’s previous $1.1 million salary. Bloomberg Businessweek reporter Karen Weise uncovered a new court document showing that Dan Price was served with the suit weeks before making the minimum salary announcement, contrary to the popular narrative that Lucas Price’s suit was in reaction to the salary announcement.
“The lawsuit couldn’t have been prompted by the pay raise—if anything, it may have been the other way around,” Weise wrote.
Inc. reporter Keegan wrote in a follow-up story on Friday, “That scenario is a possibility that Inc. considered and rejected as far-fetched. Nothing in the Businessweek story alters our judgment.”
This past July, GeekWire questioned the timing of the lawsuit in relation to the salary announcement, noting that the complaint against Dan Price was signed by Lucas Price’s lawyer on March 12, about a month before Price’s salary announcement was first reported in a story in the New York Times. At the time, Dan Price did not respond to GeekWire’s questions about the timing, much as he hasn’t responded to our recent questions about the mortgage.
Weise also cited statistics to show that Price’s salary as CEO of Gravity Payments before the compensation changes was “atypical for a company its size.”
The Bloomberg article also described how Price’s ex-wife — who has since changed her last name to Colón — spoke at a TEDx event in October about the “power of writing to overcome trauma,” including details of alleged abuse by her former husband. Price denied the allegations of abuse in a follow-up interview with Bloomberg Businessweek. Video of the TEDx talk is reportedly set to be released this week.