SEC, Under Biden’s White House, Launches LAWSUIT Against Elon Musk

The Securities and Exchange Commission (SEC) has filed a lawsuit against Elon Musk, alleging securities fraud in his 2022 acquisition of Twitter, now known as X.

Don’t think this isn’t politically motivated.

At a Glance

  • SEC sues Elon Musk for allegedly failing to disclose his Twitter stake properly
  • Musk accused of buying Twitter shares at artificially low prices, underpaying by at least $150 million
  • Musk’s lawyer calls the SEC’s action a “sham” and an admission of a weak case
  • President-elect Donald Trump’s upcoming second term adds political intrigue to the proceedings

SEC Files Lawsuit Against Elon Musk

The Securities and Exchange Commission has launched a legal battle against Elon Musk, accusing him of securities fraud related to his acquisition of Twitter in 2022. The lawsuit alleges that Musk failed to properly disclose his stake in the social media platform, allowing him to purchase shares at artificially low prices. This legal action comes after Musk’s $44 billion purchase of Twitter, which he subsequently renamed X in 2023.

According to the SEC, Musk was over 10 days late in reporting his stake, resulting in an underpayment of at least $150 million for the shares he acquired. The regulatory body claims that by March 2022, Musk owned more than 5% of Twitter shares, which legally required disclosure. However, Musk delayed this disclosure until April 4, potentially violating securities regulations.

Musk’s Response and Legal Defense

In response to the SEC’s lawsuit, Musk and his legal team have vehemently denied any wrongdoing. Musk’s lawyer, Alex Spiro, dismissed the SEC’s action as a “sham” and an admission of a weak case.

“This ‘settlement demand’ is just the latest chapter of the SEC’s harassment of Elon Musk,” Spiro stated.

Musk himself took to X to criticize the SEC, calling it a “totally broken organization.” This latest legal confrontation adds to Musk’s history of clashes with the regulatory body, including a 2018 charge for misleading statements about taking Tesla private, which resulted in a settlement.

The timing of this lawsuit is particularly intriguing given the upcoming political changes. With President-elect Donald Trump’s second term on the horizon, Musk is set to have significant influence in the White House. Trump’s administration is expected to focus on reducing regulations, which could impact the trajectory of this case.

Trump plans to replace SEC Chairman Gary Gensler with Paul Atkins, signaling a potential shift in regulatory approach. Furthermore, Musk and Vivek Ramaswamy are slated to head Trump’s Department of Government Efficiency (DOGE), potentially reshaping the regulatory landscape. As Gensler prepares to step down on January 20, it remains uncertain whether the new administration will continue to pursue this lawsuit against Musk.