After more than two years of investigation, the Securities and Exchange Commission continued Elon Musk for his late disclosure of the Twitter shares he accumulated before announcing his intention to acquire the company in 2022.
In a court filing, the SEC says Musk filed documents with the SEC revealing his purchase of Twitter stock 11 days after the SEC’s deadline to do so. (Federal law, as the SEC notes in its statement, requires investors to publicly report when they have acquired a stake of more than 5% in a company.) This delay, according to the regulator, allowed Musk to buying even more Twitter stock at a time when other investors were unaware of his involvement in the company.
From the trial:
During the period that Musk was required to publicly disclose his actual ownership but failed to do so, he spent more than $500 million to purchase additional shares of Twitter common stock. Because Musk failed to timely disclose his beneficial ownership, he was able to make these purchases to the unsuspecting public at artificially low prices, which did not yet reflect the material undisclosed information about Musk’s beneficial ownership of more of five percent of Twitter’s common stock and investments. aim. In total, Musk underpaid Twitter investors by more than $150 million for his purchases of Twitter common stock during this period. Investors who sold Twitter common stock during this period did so at artificially low prices and thereby suffered substantial economic harm.
The regulator has been investigating Musk for years and has long been at odds with the owner of X. At one point, the SEC accused Musk of trying to block and using “gambling” to delay his investigating its investment in Twitter. Last month, Musk shared a copy of a letter addressed to SEC Chairman Gary Gensler, in which Elon Musk’s lawyer, Alex Spiro, accused the regulator of “six years of harassment” targeting Musk. The letter stated that Musk had refused a settlement offer from the SEC regarding its Twitter investigation.
Musk also faced a problem from other Twitter investors and a related to late disclosure. However, as The New York Times It’s unclear whether the SEC’s latest action will be of much help, as Gensler is expected to resign after President Donald Trump’s inauguration.
X did not immediately respond to a request for comment. In a statement to time, Spiro called the SEC’s action a “single-count complaint,” calling it “an admission by the SEC that it cannot bring a real case.” »
