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SEC Takes Legal Action Against Elon Musk Over Twitter Stake Disclosure Delay
The United States Securities and Exchange Commission (SEC) has taken legal action against billionaire entrepreneur Elon Musk over allegations of securities fraud related to his 2022 acquisition of Twitter. According to the SEC, Musk failed to disclose his stake in the social media platform within the required timeframe, allowing him to purchase additional shares at a lower price.
The dispute centers around Musk’s initial investment in Twitter. As per federal regulations, any individual or entity holding more than 5% of a publicly traded company’s shares must file a report with the SEC within ten days of crossing that threshold. In this case, the commission claims that Musk delayed his disclosure by eleven days, allowing him to purchase additional shares at a lower price.
The SEC alleges that Musk’s delayed disclosure had a significant impact on the stock market, as unsuspecting investors were unaware of his growing stake in Twitter. As a result, Musk was able to acquire more shares at a discounted rate, saving him over $150 million. The commission has sought a jury trial and is demanding that Musk pay civil penalties and return the profits he earned from the delayed disclosure.
This latest legal issue adds to the growing list of controversy surrounding Musk’s actions as CEO of Twitter. Just last year, it was reported that Musk had secretly bought nearly 9% of Twitter before announcing his stake publicly, raising concerns about market manipulation.
Source: cryptonewsland.com
