The U.S. Securities and Exchange Commission (SEC) has taken legal action against billionaire Elon Musk, alleging that he did not promptly report his significant ownership stake in Twitter prior to acquiring the platform in 2022. The SEC claims that this oversight allowed Musk to buy the shares for at least $150 million less than he should have.
Musk began purchasing Twitter shares in early 2022, surpassing the 5% ownership threshold by March of that year. According to the SEC, he was legally obligated to disclose this information at that time, but he did not make the required announcement until April 4—11 days after the deadline.
Following Musk’s agreement to buy Twitter in April 2022, he attempted to back out of the deal, which led to the company taking legal action to enforce the acquisition. The SEC began an investigation into potential violations of securities laws related to Musk’s Twitter stock transactions and his public statements about the company.
As part of this inquiry, the SEC even sought to compel Musk to testify. It’s worth noting that Gary Gensler, the current chair of the SEC, is set to step down on January 20. It remains uncertain whether the incoming administration will choose to proceed with the lawsuit against Musk.
