SEC sues Elon Musk, accusing him of withholding info that cost Twitter investors millions
The U.S. Securities and Exchange Commission filed a lawsuit against Elon Musk on Tuesday, accusing X owners of misleading shareholders about buying Twitter stock in 2022.
The lawsuit accuses Musk of violating federal securities laws by allowing him to buy Twitter stock at artificially low prices before acquiring the social media site for $44 billion. Musk has the U.S. Securities and Exchange Commission “Just another weaponized agency doing the dirty work of politics.”
Musk began buying Twitter stock in early 2022 and later renamed it X. By mid-March, he had acquired ownership of more than 5% of the company’s outstanding shares, according to SEC filings. He was required to file a report with the SEC disclosing his purchases, but the lawsuit alleges he failed to do so “in a timely manner,” causing him to pay at least $150 million in fees for shares purchased by other investors during that period.
The committee said Musk waited until April 4, 2022, 11 days after the report was due, to publicly disclose his beneficial ownership in the SEC report.
“Investors who sold Twitter common stock at artificially depressed prices during this period suffered substantial financial losses as a result,” the SEC said in its lawsuit.
The U.S. Securities and Exchange Commission said it hopes the court will order Musk to pay “the return of unjust gains resulting from his illegal conduct.” The SEC is also seeking civil penalties.
Musk Respond to lawsuit news on Tuesday night, calling the SEC a “totally broken organization.”
“They spend their time doing things like this while so many actual crimes go unpunished,” Musk wrote.
In a statement late Tuesday night, Musk’s attorney Alex Spiro told CBS News, “Today’s action is an admission by the SEC… that they cannot bring an actual case – Because Mr. Musk did nothing wrong, everyone saw the scam.”
In July 2022, Musk trying to pull out The Twitter deal, but Company sues to hold him to their agreement, and he completed the takeover October of that year.
Musk has had previous run-ins with the SEC. The U.S. Securities and Exchange Commission (SEC) filed a lawsuit in 2018 accusing Musk of misleading Tesla investors. According to the SEC, in 2023 seek court order Forcing Musk to testify as part of the investigation into his purchase of X. He later testify for investigation.
The SEC lawsuit comes shortly before Chairman Gary Gensler plans to resign from the commission. It’s unclear whether the new administration will pursue the lawsuit. President-elect Donald Trump has selected Paul Atkins as the new SEC Chairman.
Musk is a famous trump supporter and republican donorsand was selected by Trump to lead the Department of Government Effectiveness, or dog.
