SEC sues Musk, alleging Twitter-related securities violation
The Securities and Exchange Commission (SEC) has sued tech billionaire Elon Musk, alleging he committed securities fraud by failing to disclose his ownership of Twitter.
According to the SEC complaint filed Tuesday in D.C. District Court, Musk withheld information that allowed him to underpay for the shares of Twitter he bought “after his financial beneficial ownership report was due.”
The SEC launched an investigation into Musk in April 2022 over his initial purchase of Twitter stock and his various SEC filings related to the social media company.
Before acquiring Twitter, now known as X, for $44 billion in October 2022, Musk had increased his shares in the company.
The SEC requires investors to disclose when they own more than 5 percent of a company. Musk did not disclose any Twitter holdings until April 4, 2022, when he owned more than 9 percent of shares, the complaint said.
“During the period that Musk was required to publicly disclose his beneficial ownership but had failed to do so, he spent more than $500 million purchasing additional shares of Twitter common stock,” the SEC said. “Because Musk failed to timely disclose his beneficial ownership, he was able to make these purchases from the unsuspecting public at artificially low prices.”
The SEC alleges that Musk underpaid Twitter’s investors by more than $150 million during that period.
Musk previously criticized the SEC over a settlement offer in the agency’s investigation. In a letter sent last month to SEC Chair Gary Gensler that Musk shared on X, his attorney Alex Spiro said the SEC gave Musk 48 hours to accept a monetary payment or face charges on several counts. Spiro said the agency has harassed Musk for years.
The tech billionaire, who has been named to co-lead President-elect Trump’s “Department of Government Efficiency,” previously sat for two depositions with the SEC but refused to testify for a third time in 2023. He later agreed to testify but skipped his scheduled appearance last September.
After he skipped his scheduled testimony, the SEC said it planned to reprimand the billionaire.
The suit is one of Gensler’s last in his position, as he said he would step down before Trump has the chance to fire him. Trump, who has become close with Musk in recent months, could have Gensler’s replacement, Paul Atkins, pull back on the suit.
In a statement to The Hill, Musk's lawyer, Alex Spiro, said the action from the SEC shows they "cannot bring an actual case." He said Musk has done nothing wrong and said the suit was a "sham."
Updated at 8:53 p.m. EST.
-
The SEC Is Suing Elon Musk. It’s All in the Timing
Less than a week before Donald Trump takes office, the SEC has filed a complaint against his most prominent benefactor.Wired - 4h -
SEC lawsuit against Elon Musk is a big political test for Trump administration
Trump appointee Paul Atkins is set to face a major minefield upon taking over leadership of the SEC, given Musk’s close ties to the incoming president.MarketWatch - 5h -
SEC sues Elon Musk over alleged late disclosures on Twitter share deal
Regulator says Trump ally got $150mn discount by not disclosing stake in social media group on timeFinancial Times - 7h -
Vince McMahon will pay $1.7 million to settle SEC allegations over hush money agreements
Former WWE impresario Vince McMahon agrees to settle allegations by the SEC that he paid millions in hush money to two women without telling his board.Los Angeles Times - 4d -
UK security officials monitor Elon Musk's posts
A Home Office team is tracking the reach and impact of posts by the tech mogul and others for security risks.BBC News - 4d -
Alec Baldwin sues prosecutors in Rust trial, alleging civil rights violations
Actor has filed civil lawsuit claiming prosecutors targeted him for professional or political gain, and intentionally concealed evidence that vindicated him. Actor Alec Baldwin has filed a civil ...The Guardian - 5d -
Blake Lively sues 'It Ends With Us' director Justin Baldoni alleging harassment and smear campaign
Actor Blake Lively sued “It Ends With Us” director Justin Baldoni and several others tied to the romantic drama on Tuesday, alleging harassment and a coordinated campaign to attack her reputation ...NBC News - Jan. 1 -
Blake Lively sues 'It Ends With Us' director Justin Baldoni alleging harassment and smear campaign
Actor Blake Lively has sued the director of the film “It Ends With Us” alleging harassment on the set and a coordinated campaign to smear her reputationABC News - Jan. 1
More from The Hill
-
FAFSA forms to make October release after two-year struggle
The Free Application for Federal Student Aid (FAFSA) forms will be released on Oct. 1 this year, the Department of Education announced on Wednesday, hitting the normal deadline after two chaotic ...The Hill - 2h -
Nearly half of Americans skeptical Trump admin will lower health costs: Poll
Nearly half of Americans don’t believe that the incoming Trump administration will lower health costs, according to a new Gallup poll. The research, conducted after the presidential election, ...The Hill - 2h -
Jeffries: With narrow margin, House GOP can’t ‘pass anything close’ to bill Johnson floating
House Minority Leader Hakeem Jeffries (D-N.Y.) argued House Republicans, with their narrow margin, won’t be able to pass “anything close” to what Speaker Mike Johnson (R-La.) has been floating. ...The Hill - 3h -
Here are the confirmed attendees at Trump’s inauguration
President-elect Trump’s Inauguration Day is less than a week away and he’s begun to plan who will attend various events in Washington to mark his return to the White House. Trump has invited many ...The Hill - 3h -
California Democrat hits FEMA over assistance claim denials: 'That's not right'
Rep. Judy Chu (D-Calif.), whose district has been damaged by the Eaton Fire, criticized FEMA for reportedly rejecting disaster assistance claims because of a lack of insurance information. "I am ...The Hill - 4h
More in Politics
-
FAFSA forms to make October release after two-year struggle
The Free Application for Federal Student Aid (FAFSA) forms will be released on Oct. 1 this year, the Department of Education announced on Wednesday, hitting the normal deadline after two chaotic ...The Hill - 2h -
Nearly half of Americans skeptical Trump admin will lower health costs: Poll
Nearly half of Americans don’t believe that the incoming Trump administration will lower health costs, according to a new Gallup poll. The research, conducted after the presidential election, ...The Hill - 2h -
Jeffries: With narrow margin, House GOP can’t ‘pass anything close’ to bill Johnson floating
House Minority Leader Hakeem Jeffries (D-N.Y.) argued House Republicans, with their narrow margin, won’t be able to pass “anything close” to what Speaker Mike Johnson (R-La.) has been floating. ...The Hill - 3h -
Here are the confirmed attendees at Trump’s inauguration
President-elect Trump’s Inauguration Day is less than a week away and he’s begun to plan who will attend various events in Washington to mark his return to the White House. Trump has invited many ...The Hill - 3h -
California Democrat hits FEMA over assistance claim denials: 'That's not right'
Rep. Judy Chu (D-Calif.), whose district has been damaged by the Eaton Fire, criticized FEMA for reportedly rejecting disaster assistance claims because of a lack of insurance information. "I am ...The Hill - 4h