Elon Musk settles SEC lawsuit over Twitter purchase and agrees to pay $1.5m fine
Summary
Elon Musk agreed to pay a $1.5 million fine to settle a lawsuit from the US Securities and Exchange Commission (SEC) for delaying the disclosure of his initial Twitter stock purchases. Musk did not admit to any wrongdoing and will not return the money he allegedly saved from the delay.Key Facts
- The SEC accused Musk of waiting 11 days in 2022 before reporting his first 5% stake in Twitter, now called X.
- Musk’s trust will pay a $1.5 million civil penalty without admitting guilt.
- The SEC claimed Musk’s delay allowed him to buy over $500 million in shares at lower prices.
- Musk completed the $44 billion Twitter purchase in October 2022.
- Musk combined Twitter with his AI company xAI and then merged xAI into SpaceX.
- This settlement is the largest SEC fine for this type of violation.
- The SEC had previously sued Musk in 2018 for a separate securities fraud case.
- Musk is also involved in another Twitter-related lawsuit where a jury found him liable for defrauding shareholders by lowering Twitter’s stock price.
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