December 14th 2024.
Elon Musk has recently been in a bit of a bind with the Securities and Exchange Commission (SEC). They've asked him to either pay a fine or face charges for what he did, or didn't, disclose about his purchases of Twitter stock before he acquired the social media platform in 2022. Musk took to the platform, now known as X, to share a letter from his lawyer, Alex Spiro, to the outgoing SEC chairman, Gary Gensler. In the letter, Spiro calls the commission's demand for a monetary payment a "misguided scheme" that won't intimidate Musk. He also claims that the SEC has reopened an investigation into Neuralink, Musk's computer-to-human brain interface company.
The SEC has not released the letter and has declined to comment on its contents or confirm if they have indeed demanded payment from Musk. According to an email statement from an agency spokesperson, the SEC conducts investigations confidentially to maintain the integrity of the process. The Associated Press also reached out to Spiro for comment but did not receive a response.
In the letter, Spiro addresses the SEC's demands for information regarding a multi-year investigation into "certain purchases, sales, and disclosures of Twitter shares." He also demands to know who was responsible for directing these actions. Musk had bought Twitter back in October 2022 for a whopping $44 billion. However, a lawsuit filed by a Twitter investor in April 2022 alleged that Musk had violated a regulatory deadline to disclose his stake of at least five percent in the company. The complaint stated that Musk did not reveal his position in Twitter until after he had doubled his stake to over nine percent.
This delay, according to the lawsuit, caused harm to regular investors who ended up selling their shares in the company in the two weeks before Musk publicly announced his significant stake in Twitter. The disclosure of his stake in the company caused the stock value to skyrocket by 27 percent. The lawsuit claims that this delay deprived investors of the opportunity to make significant gains from their shares.
Musk has been at odds with the SEC since 2018 when he and his electric car company, Tesla, were each fined $20 million for tweets Musk had made about taking Tesla private. The SEC required Musk to have his posts about Tesla reviewed by a Tesla attorney, and Musk tried to challenge this part of the settlement, claiming it violated his right to free speech. However, the Supreme Court rejected his appeal without comment.
The outgoing SEC chairman, Gensler, who was nominated by President Joe Biden, has announced that he will step down from his position on January 20, when Donald Trump is inaugurated as president. Trump has named cryptocurrency advocate Paul Atkins as the new SEC chairman. In addition, Trump has appointed Musk as co-chair of a "Department of Government Efficiency" to reform the federal government. Stay up to date with all the latest news, sports, politics, and weather by downloading the 9NEWS app on the Apple App Store or Google Play.
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