Elon Musk is being sued by the U.S. Securities and Exchange Commission (SEC), which claims that he broke federal securities laws by neglecting to reveal his sizeable Twitter ownership promptly.
According to the SEC, Musk underpaid Twitter stockholders by more than $150 million because his delay in disclosing information permitted him to buy more shares at inflated cheap prices.
The SEC claims that Musk purchased a 5% investment in Twitter by March 2022 but failed to reveal this information until April 4, 2022, which is 11 days past the 10-day reporting deadline.
He allegedly kept prices lower than they might have been with prompt disclosure because of this delay, which allowed him to keep buying shares without the market responding to his substantial ownership.
Musk’s attorney, Alex Spiro, has dismissed the lawsuit as a “sham,” asserting that the SEC’s actions are part of a prolonged harassment campaign against Musk.
This legal action adds to Musk’s ongoing disputes with the SEC, including previous settlements over his statements about taking Tesla private in 2018. The current lawsuit underscores the regulatory challenges Musk faces amid his high-profile business ventures.
