Elon Musk mocks US agency just days after settling with it

Alicia Cross
October 7, 2018

'Just want to [say] that the Shortseller Enrichment Commission is doing incredible work.

The SEC deal requested Musk step down as chairman of Tesla, though he could remain as its chief executive, and pay a $20m (£15.3m) fine.

Also on Thursday, District Judge Alison Nathan in Manhattan gave Mr Musk and the SEC until 11 October to explain why the deal they had struck was fair and reasonable and would not hurt the public interest.

FILE PHOTO: Tesla Chief Executive Office Elon Musk speaks at his company's factory in Fremont, California, U.S., June 22, 2012. "And the name change has is so on point!"

Tesla declined to comment.

Musk took a not-so-subtle shot at the U.S. Securities and Exchange Commission - known to most people as the SEC - in a tweet. After Musk initially rejected a settlement offer from the agency, which the SEC responded to by suing him, Tesla and its CEO accepted revised settlement agreements that are somewhat harsher.

"Tesla and the board of directors are fully confident in Elon, his integrity, and his leadership of the company, which has resulted in the most successful US auto company in over a century", the board said. Tesla also suffered a hit, in spite of the company itself not being charged with fraud - it has to pay a $20 million fine as well. A judge has yet to approve the settlement. Despite burning through approximately $3.48 billion over the course of a year, Elon Musk hinted that Tesla may soon be profitable in recent emails to employees.

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But some former SEC officials and legal experts were divided over whether Musk's comment had crossed a legal line.

After determining that the tech entrepreneur was guilty of misleading investors when he tweeted that that he had secured funding to take Tesla private, federal regulators reached out to the electric auto maker to discuss a suitable punishment.

In addition to Tesla, Musk is also CEO of SpaceX, The Boring Company, and Neuralink.

"Corporate officers hold positions of trust in our markets and have important responsibilities to shareholders", SEC Enforcement Division co-director Steven Peikin said in a statement.

As part of Musk's settlement with the SEC, Tesla is supposed to monitor its CEO's Twitter posts, but only those that have to do with company news.

"I think it is juvenile and sophomoric and narcissistic, but I don't think it has particular relevance to the subject of the lawsuit against him", said Harvey Pitt, the SEC chairman under President George W. Bush.

In a letter to investors, David Einhorn, the manager of hedge fund Greenlight Capital, warned that investors should be very wary of Tesla stock.

Other reports by Free-Prsite

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