Elon Musk required to pay penalty in US for Twitter stock purchases disclosures
Elon Musk has recently shared that the Securities and Exchange Commission (SEC) is asking him to pay a penalty or potentially face charges regarding his disclosure (or lack thereof) of his Twitter stock purchases back in 2022. According to a letter posted on the new X platform from Musk’s lawyer, Alex Spiro, this demand for payment is being contested as a ‘misguided scheme’ that Musk isn’t backing down from.
The allegations also mention a reopened investigation by the SEC into Neuralink, Musk’s brain-computer interface company. However, the SEC has not confirmed the details or commented publicly on the matter, keeping with their policy of conducting investigations confidentially to maintain the integrity of the process.
Spiro’s letter responds to requests from SEC members concerning an investigation into the purchases, sales, and disclosures of Twitter shares over several years. Additionally, it demands information on who authorized these actions. Musk acquired Twitter for $44 billion in October 2022, but a lawsuit from an investor claimed he violated regulations by not disclosing his ownership stake in Twitter until it had reached 9%, causing harm to ordinary investors who sold their shares before his major stake was made public.
This isn’t the first time Musk has had a run-in with the SEC, as back in 2018, both he and Tesla paid fines for tweets about potentially taking Tesla private. Musk challenged a settlement provision that required his Tesla-related posts to be reviewed by company lawyers, arguing it infringed on his right to free speech. The Supreme Court denied his appeal, and now with Gensler stepping down from his role as SEC chairman, a new nominee, Paul Atkins, has been announced by Trump to lead the SEC.
It’s also worth noting that Musk has been appointed as co-chair of the ‘Department of Government Efficiency’ by Trump, in an effort to reform the federal government. Stay tuned for updates on this developing story.
